U.S. Initial Jobless Claims Remained Low Last Week, Labor Market Still Resilient

U.S. initial jobless claims remained low last week, once again highlighting the resilience of the U.S. labor market. Data released by the U.S. Department of Labor on Thursday showed that initial jobless claims for the week ending October 10 were 199,000, slightly below the consensus estimate of 200,000 and above the revised prior reading of 198,000; continuing claims for the week ending October 3 were 1.71 million, in line with the consensus estimate, with the prior reading revised to 1.714 million from 1.716 million; the four-week moving average of initial jobless claims for the week ending October 10 was 198,500, with the prior reading revised to 198,250 from 198,000. U.S. initial jobless claims remain near their lowest level since the 1960s. Combined with the more moderate increase in nonfarm payrolls in September, the depressed level of applications indicates that the labor market is in a state where employers, amid rising costs, are cautious about expanding hiring but are still retaining existing workers. A still-resilient U.S. labor market, combined with rising inflationary pressures, may support the Federal Reserve in taking further action on interest rates. After the U.S. September CPI data released on Wednesday came in above expectations, the U.S. September PPI data released on Thursday also beat expectations across the board, indicating that the impact of rising energy prices is being transmitted across various sectors of the U.S. economy. As of press time, according to the CME "FedWatch" tool, traders' probability of betting on a 25-basis-point rate hike by the Fed in October has risen to nearly 30%, higher than about 18% before the release of Wednesday's CPI data, but lower than the more than 50% briefly touched after the CPI data was released; the probability of a rate hike in December has reached 66%.