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The Wall Street will be closely watching Thursday’s announcement of the U.S. Department of Labor's initial unemployment insurance weekly claims, which some estimates say could increase to 220,000 from last week’s 216,000, according to an investing.com report. If the claims go up as predicted, it would be a reversal of a four-week drop in insurance claims, underscoring a resounding economic recovery supported by robust job growth.
The unemployment claims are a metric that the Federal Reserve closely monitors to fine-tune its interest regime. The Fed Reserve returned to easing the interest rate only in September after nearly 22 months of increasing or holding it steady, thus tightening the currency supply by making bank loans dearer. It achieved the target inflation rate of nearly 2 percent by squeezing the money supply and felt emboldened to reverse the trend by cutting the interest rate to about 4.75 percent in September after successfully guiding the economy through the COVID-induced recessionary worries.
Last week’s actual claims of 216,000 easily beat the forecast of 229,000, which was an increase from the previous week’s actual of 228,000.
The expected rise in jobless claims could force a further dose of interest rate reduction to increase the money supply and galvanize the economy for achieving higher employment generation.
An AP report last week said America’s employers added just 12,000 jobs in October, a total that economists said was held down by the effects of strikes and hurricanes that left many workers temporarily off payrolls. The report from the Bureau of Labor Statistics provided a somewhat blurry view of the job market at the end of a presidential race, the report said.
Last month’s hiring gain was down significantly from the 223,000 jobs that were added in September, according to the report. But economists have estimated that Hurricanes Helene and Milton, combined with strikes at Boeing and elsewhere, had the effect of pushing down net job growth by tens of thousands of jobs in October.