US weekly jobless claims decline to nine-month low: Report
1 min read . Updated: 03 Feb 2023, 06:24 AM IST
Premium- The surprise decline, reported by the Labor Department on Thursday, has raised cautious optimism that the US economy may skirt a recession or just experience a shallow and short downturn.
With the labor market remains resilient despite higher borrowing costs and mounting fears of a recession this year, there has been a decline in the number of Americans filing new claims for unemployment benefits, reported Reuters on 2 February.
As per details, the dropped to a nine-month low last week. The surprise decline, reported by the Labor Department on Thursday, has raised cautious optimism that the US economy may skirt a recession or just experience a shallow and short downturn.
Earlier on 1 February, Federal Reserve Chair Jerome Powell said that the 'economy can return to 2 percent inflation without a really significant downturn or a really big increase in unemployment'.
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"Some day soon economists will have to take down those calls for recession in 2023 because the labor market refuses to budge from the lowest unemployment rate in decades," Reuters quoted New York-based FWDBONDS's chief economist Christopher Rupkey as saying.
For the week ended January 28, the initial claims for state unemployment benefits dropped 3,000 to a seasonally adjusted 183,000. This is the lowest since April 2022 and was the third straight weekly decline in applications.
Also, the unadjusted claims slipped 872 to 224,356 last week. As per the data, the notable declines in applications were seen from Kentucky, California and Ohio, which offset increases in Georgia and New York.
This year, the jobless claims have been running low and are consistent with a persistently tight labor market. As per the Biden administration, there were 11 million job openings at the end of December, with 1.9 openings for every unemployed person.
"The labor market has yet to respond meaningfully to a rapid increase in interest rates," said New York-based White Plains' chief U.S. economist Rubeela Farooqi.
With agency inputs.
