Unemployment Claims Rise Amid Economic Indicators

Investing.com — The number of Americans filing for first-time state unemployment benefits increased more than expected last week, although it remained close to a four-month low from the previous week.

Seasonally adjusted initial jobless claims rose to 225,000 for the week ending September 28, up from an upwardly revised 219,000 the prior week, as reported by the Labor Department on Thursday. Economists had forecasted 222,000.

The previous week’s figures (ending September 21) were 218,000, the lowest since mid-May.

The four-week moving average, which smooths out volatility in weekly data, decreased to 224,250, down by 750 from the previous week.

Additionally, the number of individuals receiving aid after the initial week, an indicator of hiring, also fell to 1.826 million for the week ending September 21, a decline of 1,000.

These numbers set the stage for the important nonfarm payrolls report on Friday, expected to show a slight increase in jobs for September.

Investors are likely to consider various indicators this week, including job openings, private payrolls, and manufacturing and service sector activity, to evaluate the US labor market and economy in advance of the Federal Reserve's policy meeting in November.

Last month, the central bank decreased interest rates by 50 basis points, expressing a desire to bolster labor demand amid declining inflation pressures.

Policymakers indicated the beginning of a broader easing cycle, though it's uncertain whether the Fed will implement another significant cut or opt for a traditional quarter-point reduction next month. Currently, there is a roughly 63% chance that the Fed will decide on a 25-basis point cut, while a 37% probability exists for a 50-basis point reduction, according to CME Group’s (NASDAQ:CME) FedWatch Tool.