U.S. jobless claims fell more than economists had anticipated last week, indicating that labor market is growing stronger.
Fresh applications for state unemployment benefits dipped 6,000 to 312,000 in the week through June 14, reported the Labor Department on Thursday. The market had expected the applications to decline to 314,000.
The Federal Reserve signaled yesterday that the labor market will continue strengthening and said interest rates will be hiked from next year. The Fed also reduced its monthly bond-purchases by another $10 billion to $35 billion.
The four-week moving average, which smoothes out weekly volatility, declined 3,750 to 311,750 over the period. The Labor Department revealed that there were no unusual factors that affected last week’s results.
The number of individuals who are still on jobless benefits fell by 54,000 to 2.56 million in the week through June 7. This shows that employers hired more workers over the period. The unemployment rate among individuals who are still collecting jobless benefits plunged to 1.9 percent in the week through June 7, the weakest level since October 2007.
Economy to Grow Faster Next Year
Recent data also showed that employers boosted nonfarm payrolls by 217,000 in May, the first time the figure has stayed above 200,000 since late 1990s. Unemployment rate also stood at 6.3 percent. So far, the economy has recovered all the 8.7 million jobs that were lost over the recession.
On Wednesday, the Federal Reserve Chair Janet Yellen signaled that the economy will grow much faster over the next two years due to the strengthening labor market, lower household debt, the Fed’s loose monetary policy among other conditions.
“Economic activity is rebounding in the current quarter and will continue to expand at a moderate pace thereafter,” said Ms. Yellen, according to Wall Street Journal. To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.
To contact the reporter of this story; Jonathan Millet at email@example.com