So, both initial and continuing unemployment claims fell, with initial claims hitting a 3 month low of 197,000.
New applications for US unemployment benefits drifted close to 57-year lows last week and layoffs decreased in September, suggesting labor market stability persisted even as employers remained cautious about boosting hiring.
The report from the Labor Department on Thursday joined a raft of other data, including robust consumer spending in August, in painting a rosy picture of the economy despite rising headwinds from the US-Israeli war with Iran, which has driven diesel prices to record highs. Economists said robust corporate profits growth and resilient domestic demand were shielding workers from layoffs, for now.
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Initial claims for state unemployment benefits slipped 1,000 to a seasonally adjusted 197,000 for the week ended September 26, the Labor Department said on Thursday. Economists polled by Reuters had forecast 200,000 claims for the latest week.
Claims have held below the 200,000 level for three straight weeks and are near levels last seen in 1969. Some economists said historically low layoffs, if sustained, could raise questions about the labor market overheating, with monetary policy implications.
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A separate report from global outplacement firm Challenger, Gray & Christmas showed layoffs announced by US-based employers dropped 18% to 43,281 in September. They were down 20% from a year ago and fell 43% in the third quarter. Employers are, however, in no rush to increase headcount.
Hiring plans increased by 90,787 last month. While that was sharply up from 12,325 in August, hiring intentions were down 23% from a year ago, and the tally was the lowest for any September since 2011. Challenger, Gray & Christmas said a surge in seasonal hiring typically seen starting in September was absent, adding that "companies are in a wait-and-see period."
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But August's market-friendly inflation readings are unlikely to be sustained. An Institute for Supply Management survey on Thursday showed inflation pressures building up at the factory gate in September, with no commodities reported to have seen price declines. The survey's measure of input prices jumped to 77.9 last month from 71.1 in August.
Meanwhile, inflation and interest rate data are not looking good.
US stocks recovered from early losses to close slightly higher on Thursday, with the S&P 500 bouncing from a two-week low as a global bond selloff reversed course after sending US Treasury yields to multi-decade highs.
Stocks were under pressure in early trading as economic data kept pointing to a solid economy with persistent price pressures that stoked fears that inflation could ultimately force the Federal Reserve to become more aggressive with rate hikes.
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Treasury yields extended gains, and the benchmark 10-year Treasury note hit a 24-year high, after closing out September with its biggest quarterly gain since 1994, and pushed equities lower after the Institute for Supply Management said its manufacturing PMI dipped to 54.5 last month from 54.6 in August and showed a jump in input prices, raising inflation worries.
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But yields turned lower as buyers stepped in, and further declined after Fed Vice Chair Philip Jefferson suggested the central bank may be patient before hiking rates again, following a 25 basis point hike in September.
The two-year US Treasury yield, which typically moves in step with interest rate expectations for the Fed, dropped about 10 basis points and was poised for its biggest daily drop since August 2025.
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Oil prices also kept stoking inflation worries. Brent crude settled up more than $4 a barrel after China suspended fuel exports, threatening to further tighten markets. The jump in crude prices helped boost the S&P 500 energy index, opens new tab 1.9% as the best performing of the 11 major S&P sectors.
Damned if I know what the hell is going on here.
