WASHINGTON (Reuters) – The number of Americans filing new unemployment insurance claims fell last week, pointing to underlying labor market strength that should continue to support the economy.
Initial claims for state unemployment benefits fell 8,000 to a seasonally adjusted 215,000 in the week ending May 18, the Labor Department said Thursday. Economists consulted by Reuters predicted 220,000 complaints last week.
The labor market is steadily rebalancing, following the Federal Reserve’s 525 basis point interest rate increases since March 2022, to slow demand in the broader economy.
The minutes of the US central bank’s monetary policy meeting from April 30 to May 1, published on Wednesday, showed that authorities assessed that “demand and supply in the labor market, in net terms, remained to achieve a better balance, albeit at a slower pace”. But they also noted that conditions “generally remained tight.”
The Fed has maintained its benchmark overnight interest rate in the current range of 5.25%-5.50% since July. Financial markets expect the first rate cut to occur in September.
The claims data covered the period during which the government consulted employers on the nonfarm payrolls component of the May employment report. Claims changed little between the April and May survey weeks. Next week’s data on the number of people receiving benefits after an initial week of aid, a proxy for hiring, could offer more clarity on the state of the labor market
So-called continuing claims increased by 8,000 to a seasonally adjusted 1.794 million during the week ending May 11, the claims report showed.
(Reporting by Lucia Mutikani; editing by Chizu Nomiyama)
