The number of American workers applying for unemployment benefits fell by 4,000 last week, dropping to their lowest levels in six months.
According to statistics released by the Labor Department Thursday, jobless claim applications fell to 217,000 for the week of Nov. 9. That’s less than the 225,000 analysts forecast.
The four-week average of weekly claims, which evens out some of the weekly ups and downs, fell by 6,250 to 221,000.
In response to weakening employment data and receding consumer prices, the Federal Reserve slashed its benchmark interest rate in September by a half a percentage point and by another quarter-point last week.
According to a report from The Associated Press, the central bank is shifting its focus from taming inflation toward supporting the job market in an attempt to pull off a rare “soft landing,” which brings down inflation without igniting a recession.
The half-point rate cut in September was the Fed’s first rate cut in four years after a series of increases starting in 2022 that pushed the federal funds rate to a two-decade high of 5.3%, according to the AP report.
Inflation has retreated steadily the past two years, approaching the Fed’s 2% target and leading Chair Jerome Powell to declare recently that it was largely under control.
During the first four months of 2024, applications for jobless benefits averaged just 213,000 a week before rising in May. They hit 250,000 in late July, supporting the notion that high interest rates were finally cooling a red-hot U.S. job market, the AP reported.
Continuing claims, the total number of Americans collecting jobless benefits, fell to 1.87 million for the week of Nov. 2, in line with analysts’ expectations, the AP reported.
