December 27, 2018 / 1:35 PM / 5 months ago

U.S. jobless claims dip in sign of labor market strength

The number of Americans filing applications for jobless benefits fell marginally last week to near a 49-year low, pointing to underlying strength in the labor market.

FILE PHOTO: People wait in line to attend TechFair LA, a technology job fair, in Los Angeles, California, U.S., January 26, 2017. REUTERS/Lucy Nicholson

Initial claims for state unemployment benefits dropped 1,000 to a seasonally adjusted 216,000 for the week ended Dec. 22, the Labor Department said on Thursday.

Initial claims have now fallen in three of the last four weeks and are just above the 49-year low of 202,000 reached in the week ended Sept. 15.

After several years of near-steady falls, claims trended higher between mid-September and mid-December, prompting concern the U.S. economy was losing a step.

It remains unclear how much of that increase was related to the difficulty government statisticians have in adjusting the claims data for seasonal swings. Claims can be volatile at the end of the year when U.S. holidays throw off a model that the government uses to smooth the data for seasonal fluctuations.

Economists polled by Reuters had forecast claims increasing to 217,000 in the latest week.

The Federal Reserve raised interest rates last week for the fourth time this year, but forecast fewer rate hikes next year and signaled its tightening cycle is nearing an end in the face of financial market volatility and slowing global growth.

The Labor Department said claims were estimated last week for the states of California, Kansas, Texas and Virginia.

The four-week moving average of initial claims, considered a better measure of labor market trends as it irons out week-to-week volatility, fell 4,750 to 218,000 last week.

The claims report also showed the number of people receiving benefits after an initial week of aid decreased 4,000 to 1.70 million for the week ended Dec. 15.

The four-week moving average of the so-called continuing claims fell 1,000 to 1.68 million.

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