US Jobless Claims Drop to Four-Month Low Indicating Economic Resilience

The number of Americans filing new unemployment benefit applications hit a four-month low, indicating strong job growth in September. The latest Labor Department report also emphasizes the U.S. economy's continued expansion, backed by a recent Federal Reserve interest rate cut intended to sustain low unemployment rates.

The number of Americans filing new applications for unemployment benefits last week dropped to a four-month low, pointing toward buoyant job growth in September and confirming that the economy continued to expand in the third quarter.

The Labor Department's weekly jobless claims report, considered the most timely data on the economy's health, also revealed that unemployment rolls shrunk to levels last seen in early June. On Wednesday, the U.S. central bank slashed interest rates by 50 basis points, a first since 2020, indicating policymakers' commitment to maintaining a low unemployment rate. Chief economist Carl Weinberg of High Frequency Economics remarked, "These hard numbers confirm the message delivered by Fed Chair Powell yesterday."

Initial claims for state unemployment benefits dropped by 12,000 to a seasonally adjusted 219,000 for the week ending Sept. 14, the lowest since mid-May. Despite notable rises in states like California, Texas, and New York, where claims increased by 6,436, unadjusted claims saw an increase, offset by a decrease of 2,055 in Massachusetts. Overall, layoffs remain low, helping to prop up the economy through solid consumer spending. Economic growth estimates for the third quarter are around a 3.0% annualized rate, consistent with the second quarter's pace.

(With inputs from agencies.)