Weekly jobless claims—a measurement of the number of people who filed for unemployment insurance for the first time—fell for the second straight week as the labor market remains resilient even after hurricanes Helene and Milton devastated the southeast.
Markets had penciled in a reading of 242,000.
The economic fallout from the two hurricanes appears to be limited as initial jobless claims in storm-affected states were mostly subdued.
The number of claims declined in Kentucky by 457, in North Carolina by 2,888, and in Tennessee by 1,198.
Still, Florida registered an increase of 4,275 jobless claims last week.
For the week ending Oct. 12, Georgia recorded a 3,293 increase in unemployment benefit claims because of layoffs in manufacturing. New York also witnessed a change of 2,340 amid terminations in the transportation and warehousing industry.
Continuing jobless claims—a gauge of the number of people currently receiving weekly unemployment benefits—rose to a higher-than-expected 1.897 million for the week ending Oct. 12. This is up from the previous week’s upward revision of 1.869 million.
The four-week average, which eliminates week-to-week volatility, edged up to 238,500 from 236,500.
Economists and policymakers had warned that the natural disasters and labor disputes would affect employment data.
Federal Reserve Gov. Christopher Waller recently stated at a Stanford University event that the storms could lead to a weak October jobs report.
Early estimates suggest the U.S. economy created 180,000 new jobs this month.
However, based on the latest weekly jobless claims, effects of the hurricanes and labor strife might have faded.
Market Reaction
U.S. stocks were mixed following the latest employment data.The tech-heavy Nasdaq Composite Index was up by as much as 1 percent before the opening bell, recovering some of its losses incurred this week. The blue-chip Dow Jones Industrial Average and the benchmark S&P 500 Index were little changed.
Treasury yields took a breather and were swimming in a sea of red ink. The benchmark 10-year yield slipped to 4.22 percent, which is still the highest level since July.
The U.S. dollar index (DXY), a metric of the greenback against a basket of currencies, fell by about 0.2 percent, to 104.22.
Bond yields and the DXY have rallied since the Federal Reserve cut interest rates and signaled more rate reductions ahead. Market watchers have offered a plethora of reasons for the unexpected jump, from fiscal concerns to supply-demand dynamics.
“The term premium, which is unobservable and hence must be approximated, considers a variety of factors, including Treasury supply/demand dynamics, foreign central bank expectations, and the possibility of future inflationary pressures,” Lawrence Gillum, chief fixed-income strategist at LPL Financial, said in a note emailed to The Epoch Times. “Additionally, rising term premiums could also indicate markets are betting on higher government deficits depending on election odds.”
Mark Malek, the CIO at Siebert Financial, said hawkish bond traders are facing off against the dovish Fed.
“While the dovish Fed is pulling its foot off the brake, hawkish bond traders are pressing down on it,” Malek wrote in a note emailed to The Epoch Times. “Finally, it should be noted that the Fed could impact long-term Treasury yields if they wanted to through quantitative easing, but alas, the Fed is not easing, but rather it is still tightening by shrinking the balance sheet, just at a slightly slower pace than a few years back in its tightening cycle.”
The FOMC will hold its next two-day policy meeting on Nov. 6–7.
