The news: US weekly jobless claims fell unexpectedly to 201,000 last week, the lowest in nearly a year, according to data from the Labor Department.
The context: The data – published a day earlier as federal government offices and markets will be closed on Thursday due to the national day of mourning for former President Jimmy Carter – showed that despite cooling from peak post-pandemic job creation levels, the labour market remains resilient.
It comes ahead of December’s non-farm payrolls report, due Friday, and amid rising Treasury yields due to concerns over inflation and fiscal policy uncertainty under President-elect Donald Trump.
The numbers: The move for the week ending 4 January represents a 10,000 decrease from the prior week, against economists’ expectations of 218,000 claims.
The four-week average dropped to 213,000, while continuing claims, a gauge of those receiving benefits after an initial claim, rose by 33,000 to 1.87 million as of 28 December.
Treasury yields on 20-year bonds hit 5% for the first time since 2023, amid concerns over inflation and fiscal policy uncertainty. The 10-year yield rose as much as four basis points to nearly 4.73%, just shy of its highest level since November 2023, according to Bloomberg.
Friday’s jobs report is expected to show December job growth at 160,000, down from November’s 227,000, with the unemployment rate steady at 4.2%.
What they said: Meanwhile, Federal Reserve Governor Christopher Waller said he believes inflation will continue its downward trend towards the Fed’s 2% target, supporting further interest rate cuts in 2025.
