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Federal Reserve · Inflation · Jobless Claims · Labor Market
US applications for unemployment benefits dropped by 4,000 to 226,000 in the week ending June 13, as reported by the Labor Department, signaling continued historically low layoffs despite broader economic uncertainties.
Hiring has picked up in recent months, with 172,000 new jobs in May and an average of 188,000 monthly gains since the Iran war began in late February, marking the best three months of hiring since early 2024. The unemployment rate remains low at 4.3%, and job openings rose to 7.6 million in April, up from 6.9 million in March, the most since May 2024.
However, consumer inflation hit 4.2% in May, a three-year high, driven by rising gas prices due to the Strait of Hormuz closure, which has since been resolved with a US-Iran deal. The Federal Reserve, under new Chair Kevin Warsh, maintained benchmark interest rates, with some policymakers considering a rate hike to combat inflation, despite the potential negative impact on hiring.
Concerns about artificial intelligence's impact on jobs and recent layoffs at companies like Verizon, UPS, Amazon, Disney, Starbucks, and Walmart add to market uncertainty. The Labor Department’s report Thursday showed that the four-week moving average of jobless claims rose by 4,000 to 223,250, and total Americans filing for benefits increased by 24,000 to 1.81 million for the week ending June 6.
