Continuing U.S. Jobless Claims at 28-Yr. Lows

Amid the political turmoil down south, it appears one aspect of the economy remains positive; fewer folks are filing for unemployment benefits.

The U.S. Labor Department reported this morning that new applications for U.S. jobless benefits fell last week and the number of Americans on unemployment rolls tumbled to a 28-1/2-year low, pointing to rapidly shrinking labour market slack.

While the rush of upbeat economic data support an interest rate hike next month, the Federal Reserve's decision will also hinge on the state of financial markets, which have been rattled in recent days by Trump administration scandals.

The department says initial claims for state unemployment benefits decreased 4,000 to a seasonally-adjusted 232,000 for the week ended May 13, pushing claims close to levels last seen in 1973.

Claims have now decreased for three consecutive weeks. Economists had forecast first-time applications for jobless benefits rising to 240,000.

Claims have now been below 300,000, a threshold associated with a healthy labour market, for 115 straight weeks, the longest such stretch since 1970, when the labour market was smaller. The labour market is close to full employment, with the unemployment rate at a 10-year low of 4.4%.