In a good news-bad news development in the job market, the number of Americans filing new applications for jobless benefits was up a bit last week while the unemployment rate appeared to hold steady in February.
According to a report from Reuters, the weekly jobless claims report from the Labor Department on Thursday suggested the labor market “remained in a ‘low-hire, low-fire’ state.” The statistics appeared to support economists’ expectations that the Federal Reserve would not cut interest rates before Fed Chair Jerome Powell’s term ends in May, the outlet reported.
“The data show no sign of the layoffs we would expect in a weakening labor market during the early days of a hypothetical recession,” Carl Weinberg, chief economist at High Frequency Economics, told Reuters. “That will jolly up traders who believe the Fed will not cut rates anytime soon, given a steady labor market and inflation above target.”
According to statistics released by the Labor Department, initial claims for state unemployment benefits rose 4,000 to a seasonally adjusted 212,000 for the week ended Feb. 21. Economists polled by Reuters had forecast 215,000 claims for the latest week.
Lingering uncertainty since the Supreme Couret invalidated Preident Donald Trump’s tariff policies was blamed for a general hesitancy among businesses to increase hiring, according to Reuters.
“The low hiring rate is still the most concerning aspect of the labor market, but the trend in continued claims suggests employers aren’t pulling back further,” said Nancy Vanden Houten, lead U.S. economist at Oxford Economics.
The number of people receiving unemployment benefits after an initial week of aid, a proxy for hiring, dropped 31,000 to a seasonally adjusted 1.833 million during the week ended Feb. 14, the claims report showed.
Continued claims rose modestly between the January and February survey weeks. The jobless rate eased to 4.3% in January from 4.4% in December. The Chicago Fed forecast the unemployment rate steady at 4.28% in February, which would round up to 4.3%, Reuters reported.
