The number of Americans filing claims for unemployment benefits edged up last week, pointing to continued labor market stability in April, though economic uncertainty and higher prices stemming from the U.S.-Israeli war with Iran pose downside risks. The absence of widespread layoffs suggested by the Labor Department’s report on Thursday supports financial market expectations that the Federal Reserve will probably not cut interest rates this year as the nearly two-month conflict fans inflation and strains the global economy.
“The labor market has become more vulnerable since the start of the war, but the claims data over the last two months show no evidence of cracks,” said Nancy Vanden Houten, lead U.S. economist at Oxford Economics. “However, it’s always been our expectation that the spike in oil prices would take some time to become apparent in the labor market data.”
Initial claims for state unemployment benefits rose 6,000 to a seasonally adjusted 214,000 for the week ended April 18. Economists polled by Reuters had forecast 210,000 claims for the latest week. Claims remain tucked in their 201,000-230,000 range for this year. The four-week moving average of claims, which irons out week-to-week volatility, rose by only 750 to 210,750.
