US jobless claims at 3-month low, signal rising labor market momentum

The United States initial jobless claims fell to three-month low during the week ended July 16, a sign that the country’s labor market is improving in the second half of the year.

Initial claims for unemployment benefits, a proxy for layoffs across the US, fell by 1,000 to a seasonally adjusted 253,000, the lowest reading since April, data released by the Labor Department showed Thursday. Claims for the prior week ended July 9 remained unrevised at 254,000.

According to a survey of economists by Reuters, the expected Americans filing new applications for jobless benefits stood at 265,000. Moreover, the four-week moving average, which helps even out short-run swings in the data, fell by 1,250 last week to a seasonally adjusted 257,750.

In addition, few economists have commented that the economy has entered a later stage of the business cycle in which both layoffs and new job openings are simultaneously at low levels, reports said.

Also, Thursday’s report showed continuing unemployment claims, reflecting workers drawing jobless benefits for more than one week, fell 25,000 to 2,128,000 in the week ended July 9. The unemployment rate for those covered by unemployment insurance ticked down 0.1 percentage point to 1.5 percent.

Meanwhile, the Federal Reserve is scheduled to hold its monetary policy meeting on July 26-27 to discuss the state of the economy and the direction of monetary policy.