First-time claims for U.S. unemployment benefits showed a modest rebound in the week ended March 16th, according to a report released by the Labor Department on Thursday, although claims still came in below economist estimates. The report said initial jobless claims edged up to 336,000, an increase of 2,000 from the previous week's revised figure of 334,000. Economists had expected jobless claims to climb to 340,000 from the 332,000 originally reported for the previous week. The number of jobless claims in the previous week reflected the lowest level since January 19th, when claims were impacted by seasonal distortions. Excluding that dip, jobless claims were at their lowest level since early 2008. The Labor Department said its less volatile four-week moving average fell to 339,750, a decrease of 7,500 from the previous week's revised average of 347,250. With the decrease compared to the previous week, the four-week moving average dropped to its lowest level since February of 2008. Jennifer Lee, senior economist at BMO Capital, said, "This is a good time to mention that this is for the week of March 16, which is, ladies and gentlemen, the key survey week and with claims 30k below the last survey period, it suggests that we could see a +200k increase in March payrolls." "True some of this improvement could reflect the fact that a number of states are cutting back on the length of jobless benefits, but looking at this series and the other employment indicators, they support Fed Chairman Bernanke's comment yesterday that 'We are seeing improvement' on the labor front," she added." Meanwhile, the report also showed that continuing claims, a reading on the number of people receiving ongoing unemployment assistance, edged up to 3.053 million in the week ended March 9th from the preceding week's revised level of 3.048 million. The four-week moving average of continuing claims fell to 3,076,250, a decrease of 28,000 from the preceding week's revised average of 3,104,250.