US unemployment claims fall to lowest level in four months

• Unemployment Claims in the US Drop to 218,000
• Four-Week Average Falls to 224,750
• Fed Aims for a ‘Soft Landing’

The number of people applying for unemployment benefits in the US dropped last week to its lowest level in the past four months.

Claims decreased by 4,000 to 218,000 for the week ending September 21.

This is according to a report released by the Labor Department on Thursday.

This is the lowest point since mid-May and falls short of the 224,000 analysts had anticipated.

Last Week’s Figures of Unemployment Claims in the US Adjusted Upward by 3,000

The four-week moving average, which smooths out week-to-week volatility, also fell by 3,500 to 224,750.

Weekly unemployment claims are seen as an indicator of layoffs in the U.S. labor market for a given week.

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Unemployment claims have been decreasing for two consecutive weeks.

This, following a modest rise earlier in the spring.

The recent uptick in claims seems to suggest that high interest rates are starting to have an impact on the labor market.

The Federal Reserve lowered its key interest rate by half a percentage point last week.

The Central Bank is focusing on stabilizing the labor market.

The Fed’s goal is to achieve a «soft landing,» meaning to curb inflation without triggering a recession.

Inflation has been steadily retreating, nearing the Fed’s target of 2%.

For the first four months of the year, weekly unemployment claims averaged only 213,000 before rising in May.

They peaked at 250,000 by the end of July.

This supports the idea that high interest rates were finally cooling the red-hot U.S. labor market.