The number of Americans who applied for unemployment insurance last week rose slightly but remained at historically low levels, despite the Federal Reserve’s aggressive interest rate hikes aimed at cooling the economy and reducing the ongoing inflation.
US unemployment insurance claims rose by 5,000 to 217,000 during the week ended October 28, the Labor Department reported Thursday.
Claims for unemployment assistance are considered an indicator of the number of layoffs in a week.
The four-week moving average, which strips out some of the weekly volatility, rose 2,000 to 210,000.
In total, 1.82 million people collected unemployment insurance in the week ending October 21, about 35,000 more than the previous week and the most since April.
Those “ongoing claims,” analysts suggest, continue to rise because many of those currently unemployed may now struggle to find a new job.
However, the US labor market continues to show strength amid the Federal Reserve’s efforts to reduce inflation to its 2% target.
While the Federal Reserve chose not to change the benchmark lending rate on Wednesday, the central bank has raised it 11 times since March 2022 in an effort to curb inflation, which will hit a four-decade high in 2022. Part Its purpose it will also cool the economy and the labor market, which in turn will slow down the rise in prices.
In September, consumer prices rose 3.7% from a year ago, from a high of 9.1% in June last year. However, US economic growth surged in the July-September quarter due to strong consumer spending.