New claims for state unemployment insurance benefits dropped by 10,000 in the week ended June 22 to 388,000, down from a revised 398,000 in the prior week, the Labor Department report added.

Initial claims remained below the key 400,000 watermark for the fourth week in a row.

Over the past four weeks, new claims have averaged 391,000, down for the ninth straight week, and the lowest since 390,750 in the March 2 week.

The number of people continuing to draw jobless benefits fell sharply to 3.71 million in the week ended June 15 to its lowest in two months when it measured 3.69 million.