The Atlanta Journal-Constitution
U.S. jobless claims dip for third straight week
The number of people applying for unemployment benefits in the U.S. fell for a third straight week.
What it might mean
That’s good news for American workers, but potentially bad news in the fight against inflation by the Federal Reserve, which has been ratcheting up its benchmark interest rate for a year in an effort to cool the economy, loosen the labor market and tame inflation.
How it happened
Applications for jobless claims in the U.S. for the week ending Feb. 25 fell to 190,000 from 192,000 the previous week, the Labor Department said Thursday. It’s the seventh straight week claims were under 200,000.
The four-week moving average of claims, which evens out some of the weekly volatility, rose by 1,750 to 193,000, remaining below the 200,000 threshold for the sixth straight week.
Applications for unemployment benefits are considered a proxy for the number of layoffs in the U.S.
About the rate hikes
In February, the Fed raised its main lending rate by 25 basis points, its eighth rate hike in less than a year. The central bank’s benchmark rate is now in a range of 4.5% to 4.75%, its highest level in 15 years.
The Fed’s hawkish interest rate policy appeared to be slowing inflation, but recent data has suggested otherwise. Some economists now expect the Fed to raise its benchmark rate by a substantial half-percentage point when it meets later this month.
About the job market
The Fed’s rate hikes have done little to cool a red-hot U.S. job market, which has put upward pressure on wages, and as a result, prices.
Last month, the government reported that employers added a better-than-expected 517,000 jobs in January and that the unemployment rate dipped to 3.4%, the lowest level since 1969. Fed policymakers have forecast that the unemployment rate would rise to 4.6% by the end of this year, a sizable increase historically associated with recessions.