Slow cooling of the US labour market

Weekly unemployment claims statistics have improved, but there is still cause for concern. In the week ending August 23, the number of initial claims was 229,000, compared to 234,000 a week earlier. Nevertheless, there has been an increase from around 210,000 at the end of July to a low point below 205,000 at the beginning of the year.

There is also an upward trend in the number of repeat claims, which stood at 1,954,000 in the week ending August 16, showing an upward trend over the last three years from a low of 1,349,000. This is also higher than pre-pandemic levels: in 2019, the average was 1,685,000.

This is yet another batch of data supporting the slowdown in economic activity, which requires monetary policy easing. At the same time, the indicators are not yet bad enough to sound the alarm. All this brings us back to the importance of the monthly nonfarm payrolls data for August, scheduled for the end of next week.

The FxPro Analyst Team