WASHINGTON, May 21 (Reuters) – The number of Americans filing claims for unemployment benefits fell last week, pointing to labor market resilience and giving the Federal Reserve room to focus on rising inflation.
Initial claims for state unemployment benefits slipped 3,000 to a seasonally adjusted 209,000 for the week ended May 16, the Labor Department said on Thursday. Economists polled by Reuters had forecast 210,000 claims for the latest week.
Though economists expect claims to rise in the summer because of a seasonal quirk, the labor market remains in a holding pattern. Financial markets expect the U.S. central bank to keep its benchmark overnight interest rate in the 3.50%-3.75% range into next year.
The U.S.-Israel war with Iran has disrupted shipping in the Strait of Hormuz, boosting oil prices and those of other commodities, including fertilizers, petrochemicals and aluminum.
Minutes of the central bank’s April 28-29 meeting published on Wednesday showed concerns about inflation being stoked by the Iran war intensified last month, with a growing number of policymakers saying the Fed should lay the groundwork for a possible rate hike.
Policymakers “generally expected labor market conditions to remain stable in the near term,” the minutes showed, though most judged “that risks to the employment side” of the Fed’s “dual mandate were tilted to the downside.”
Last week’s claims data covered the period during which the government surveyed businesses for the nonfarm payrolls component of May’s employment report. Payrolls increased by 115,000 jobs in April after rising 185,000 in March.
The number of people receiving unemployment benefits after an initial week of aid, a proxy for hiring, increased 6,000 to a seasonally adjusted 1.782 million during the week ended May 9, the claims report showed.
(Reporting by Lucia Mutikani; Editing by Chizu Nomiyama)
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