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US jobless claims fall as labor market tightens
[WASHINGTON] The number of Americans filing for unemployment benefits unexpectedly fell last week, pointing to labour market strength that could keep Federal Reserve interest rate hikes on the table this year.
Initial claims for state unemployment benefits decreased 7,000 to a seasonally adjusted 262,000 for the week ended Feb 13, the lowest reading since November, the Labour Department said on Thursday. The prior week's claims were unrevised.
Economists polled by Reuters had forecast claims rising to 275,000 in the latest week.
The four-week moving average of claims, considered a better measure of labour market trends as it irons out week-to-week volatility, fell 8,000 to 273,250 last week.
The health of the jobs market could determine whether the U.S. central bank raises rates this year. Bets for a March rate hike have largely been eliminated against the backdrop of tightening financial market conditions and worries about the US and global economies.
A Labour Department analyst said there were no special factors influencing last week's claims data and that claims were estimated for Pennsylvania, Virginia and Puerto Rico. Pennsylvania experienced a computer glitch and Virginia was unable to provide data on time, though the issues were considered minor.
Claims are being closely monitored for signs of a pick-up in layoffs in the wake of the recent massive stock market sell-off. There is no indication so far that companies have responded to the tightening in financial market conditions by reducing headcount.
Claims have now been below the 300,000 threshold, which is associated with a strong labour market, for 50 straight weeks - the longest stretch since the early 1970s. The claims data covered the survey period for February's nonfarm payrolls.
The four-week average of claims declined 12,000 between the January and February survey periods, suggesting a pick-up in job growth. Nonfarm payrolls increased by 151,000 in January.
The claims report showed the number of people still receiving benefits after an initial week of aid increased 30,000 to 2.27 million in the week ended Feb 6. The four-week average of the so-called continuing claims rose 13,500 to 2.26 million.