Following last Friday’s much stronger than expected monthly jobs report, the Labor Department released a report on Thursday showing first-time claims for U.S. unemployment benefits fell by more than expected in the week ended February 3rd.
The report said initial jobless claims slipped to 218,000, a decrease of 9,000 from the previous week’s upwardly revised level of 227,000.
Economists had expected jobless claims to edge down to 220,000 from the 224,000 originally reported for the previous week.
Meanwhile, the Labor Department said the less volatile four-week moving average rose to 212,250, an increase of 3,750 from the previous week’s revised average of 208,500.
The report also said continuing claims, a reading on the number of people receiving ongoing unemployment assistance, fell to 1,871,000, a decrease of 23,000 from the previous week’s revised level of 1,894,000.
The four-week moving average of continuing claims still climbed to 1,849,750, an increase of 9,500 from the previous week’s revised average of 1,840,250.
“We believe that today’s number keeps the Fed on track for a first rate cut in the May-June 2024 window,” said Larry Tentarelli, President and Founder, Blue Chip Daily Trend Report. “The Fed has the luxury of waiting on a first rate cut here, with recent economic data, (jobs, GDP, consumer spending and confidence data) coming in very strong.”
“Based on today’s mostly inline number, the jobs market continues to hold up very well,” he added. “A strong jobs market and strong consumer continue to bode well for the economy and should push back on immediate recession concerns.”
Last Friday, the Labor Department released a more closely watched report showing employment in the U.S. surged by much more than expected in the month of January.
The Labor Department said non-farm payroll employment spiked by 353,000 jobs in January compared to economist estimates for an increase of about 180,000 jobs.
The report also showed significantly stronger than previously reported job growth in December, with employment surging by 333,000 jobs during the month compared to the jump of 216,000 jobs that had been reported.
Meanwhile, the Labor Department said the unemployment rate in January came in unchanged from the previous month at 3.7 percent. Economists had expected the unemployment rate to inch up to 3.8 percent.
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