US Jobless Claims Jump To Highest Level Since August: What You Need To Know

Zinger Key Points
  • Jobless claims increased by 29,000 for the week ending Oct. 1 to 219,000.
  • The number came in above average economist estimates of 204,000. 

U.S. initial jobless claims jumped more than economists anticipated last week, a potential sign the labor market could be moderating following weeks of perceived resiliency in the face of aggressive rate hikes

What Happened: Jobless claims increased by 29,000 for the week ending Oct. 1 to 219,000 from a downwardly revised level of 190,000 in the prior week, according to data the Labor Department released Thursday.

The number came in above average economist estimates of 204,000. 

The previous week's level of 193,000 was revised down by 3,000. The four-week moving average was 206,500, an increase of 250 from the previous week's revised average. The previous week's average was revised down by 750 from 207,000 to 206,250.

Continuing claims dropped to 1.361 million in the week ended Sept. 24, an increase of 15,000 from the previous week's revised level.

Why It Matters: The SPDR S&P 500 SPY ticked slightly higher following the release premarket Thursday. This week's jobless claims data comes just one day ahead of the nonfarm payrolls report, which is expected to show that employers added another 260,000 payrolls in September.

The Federal Reserve will be paying close attention as it attempts to tame runaway inflation. Data from earlier this week showed that job openings dropped significantly in August

Last month, the Fed raised its benchmark rate by 0.75% for the third straight time and indicated that it will continue to hike interest rates.

The 0.75% rate hike brought the target fed funds rate up to a new range between 3% and 3.25%, the highest levels seen since before the 2008 financial crisis.

In a press conference following the decision on rates, Fed Chair Jerome Powell reaffirmed the central bank's commitment to bringing inflation back down to its 2% goal. 

"Restoring price stability is essential to set the stage for achieving maximum employment and stable prices over the longer run. We will keep at it until we're confident the job is done," Powell said.

SPY Price Action: The SPY was down 0.18% at $376.40 Thursday morning, according to Benzinga Pro.

Photo: Dain Nielsen from Flickr.

Posted In: NewsEcon #sTop StoriesemploymentInflationInterest RatesJerome PowellUnemployment