Wednesday, February 8, 2023

USA: Applications for unemployment benefits fall

WASHINGTON ( Associated Press) – The number of people filing for unemployment benefits fell last week and remained near levels that indicate the US job market is not generally affected by aggressive interest rate hikes due to the Federal Reserve. .

The Commerce Department reported on Thursday that applications fell to 225,000 in the week ending Nov. 26, down 16,000 from the previous week, when they totaled 241,000. The less volatile four-week average rose 1,750 to 227,000.

Unemployment claims are an indirect indicator of layoffs, and when viewed in the context of other unemployment data, show that the nation’s workers enjoy exceptional job security despite other obvious weaknesses in the economy.

The Federal Reserve has raised its benchmark rate six times since March to combat inflation, which hit its highest level in four decades months ago. The housing market has doubled under the weight of mortgage rates that have more than doubled in one year. Many economists expect the United States to slide into recession next year, with Fed rate hikes raising borrowing costs and slowing economic activity.

Earlier this month, the Fed raised its short-term lending rate for the fourth time this year by 0.75 percentage points, more than triple its normal margin. The reference rate is in the range of 3.75% to 4%, the highest in 15 years.

On Wednesday, Fed Chairman Jerome Powell said the central bank will raise rates more than expected and hold them for an extended period until inflation is brought under control. However, he added that rate hikes would be less than three-quarters of a point implemented by the Fed at the last four meetings.

Nation World News Desk
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