The number of Americans who filed for unemployment benefits fell to a six-month low last week, as layoffs remain at relatively healthy levels.
The Labor Department reported Thursday that jobless claims fell 4,000 to 217,000 in the week ending Nov. 9. That’s 225,000 less than analysts had predicted.
The four-week claims average, which smooths out some weekly fluctuations, fell 6,250 to 221,000.
Weekly claims for unemployment benefits are considered to be indicative of US layoffs in a given week.
In response to weakening employment data and falling consumer prices, the Federal Reserve cut its benchmark interest rate. in September by half a percentage point and another quarter point last week.
The central bank is shifting its focus from taming inflation to supporting the labor market, seeking a rare “soft landing” in which it lowers inflation without triggering a recession.
The half-point rate cut in September was the Fed’s first rate cut in four years after a series of hikes starting in 2022 pushed the federal funds rate to a two-decade high of 5.3%.
Even if it’s a little increase in Octoberinflation has steadily retreated over the past two years, approaching the Fed’s 2% target and which Chairman Jerome Powell recently indicated was under control.
Two weeks ago, the government announced that an inflation gauge was being closely watched by the Fed it went down to the lowest level three and a half years.
In the first four months of 2024, claims for jobless benefits were just 213,000 a week before rising in May. They reached 250,000 in late July, suggesting that high interest rates were finally cooling a red-hot US labor market.
In October, the US economy a Just under 12,000 jobsthough economists pointed to recent strikes and hurricanes that left many workers temporarily without paychecks.
The Labor Department reported in August that the US economy added 818,000 fewer jobs between April 2023 and March of this year than initially reported. The revised total was seen as evidence that the labor market is continuing to slow, forcing the Fed to start cutting interest rates.
Following the claims, the number of Americans receiving unemployment benefits fell to 1.87 million in the week of Nov. 2, in line with analysts’ expectations.
