The number of Americans filing new claims for unemployment benefits fell to 206,000 last week, undershooting economist estimates and easing concerns over a cooling labor market. The Labor Department reported the decline on Thursday, with the prior week's figure revised up to 212,000 from an initially reported lower number.
Economists polled by Reuters had expected claims to reach 210,000, but the latest reading remains within the lower end of the 189,000 to 230,000 range that has persisted for much of the year. The four-week moving average of claims, which smooths volatility, increased to 204,000 from 199,750 the prior week.
Continuing claims, which track the total number of Americans receiving unemployment benefits, rose to 1.799 million, up from 1.781 million. Analysts had forecast continuing claims at 1.790 million. The data follows an unexpected decline of 23,000 in nonfarm payrolls in July, which raised questions about labor market momentum.
Federal Reserve officials have signaled that recent jobs and inflation data have not altered their outlook for interest rates. San Francisco Fed President Mary Daly told Bloomberg on Thursday that the job market shows signs of "uncomfortable stability" but is not faltering. Daly added that her rate expectations remain unchanged despite the mixed signals.
Economists attribute some of the recent volatility to seasonal adjustment challenges tied to the summer hiring cycle and the school-year calendar. The labor market's resilience, combined with tepid inflation, may support the case for the Fed to maintain its current interest rate stance when it meets in September.
