U.S. initial claims for unemployment benefits increased by 20,000 to 245,000 for the week ending Dec. 16 from the previous week's unrevised level of 225,000, the Department of Labor said.

The four-week moving average rose by 1,250 to 236,000 from the previous week's unrevised average of 234,750.

Claims procedures continue to be disrupted in the Virgin Islands months after hurricanes Irma and Maria caused widespread destruction in the Caribbean. The claims process in Puerto Rico has still not returned to normal, the department said.

The advance seasonally adjusted insured unemployment rate stood at 1.4% for the week ending Dec. 9, an increase of 0.1 percentage point from the previous week's unrevised rate. Meanwhile, insured unemployment increased by 43,000 to 1,932,000 from the previous week's revised level of 1,889,000.