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Initial jobless claims dipped to 218,000 last week

Published 09/26/2024, 08:34 AM
© Reuters

Investing.com -- The number of Americans who have filed first-time applications for unemployment benefits unexpectedly dipped last week, pointing to ongoing resilience in the US labor market.

Initial claims for state jobless benefits edged down to a seasonally-adjusted 218,000 in the week ended on Sept. 21, according to data from the Labor Department on Thursday. The prior week's tally was revised higher to 222,000, while economists had predicted a reading of 224,000.

Separately, the final reading of second-quarter US gross domestic product showed that the world's largest economy expanded at an annualized pace of 3.0% during the period, confirming a previously upwardly-revised second reading of the figure. The economy grew at a rate of 1.4% in the first quarter.

The numbers come as Federal Reserve Chair Jerome Powell is due to speak on Thursday, with investors keen to see if he provides any more insight into the central bank's interest rate plans for the rest of the year. Powell will deliver pre-recorded remarks at the US Treasury Market Conference in New York at 09:20 ET, according to the Fed's website.

Following an outsized 50-basis point rate cut last week, Powell said the move was a part of a "recalibration" of policy designed to protect the US labor market while sustainably bringing inflation back down to the Fed's stated 2% target.

Several other policymakers this week have defended the big drawdown, including Fed Governor Adriana Kugler, who said on Wednesday that the rate-setting Federal Open Market Committee needs to "balance its focus" between supressing price pressures and avoiding "pain" in the broader economy.

But Fed officials have not been unanimous in their support of the size of the cut. Fed Governor Michelle Bowman, who voted for lowering borrowing costs by a more traditional 25 basis points, has said she remains worried by lingering inflation risks.

Traders will have the chance to parse through the Fed's preferred measure of inflation on Friday.

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