Financial Services Association, September 19 (Editor: Zhao Hao) The latest US unemployment claims data fell to its lowest level since May, indicating that the labor market is still healthy despite the slowdown in recruitment.

According to data released by the US Department of Labor on Thursday (September 19), the number of people applying for unemployment benefits for the first time after the seasonal adjustment was 0.219 million, down 0.012 million from 0.231 million after the previous week's adjustment.

Number of people applying for unemployment benefits for the first time after the seasonal adjustment

It is worth mentioning that 0.219 million people were the lowest number of reports since May 25 this year. This figure is also lower than all media estimates of economists' surveys. They originally expected the number of initial applicants to remain around 0.23 million.

The four-week average of initial requests fell from 0.231 million to 0.2275 million, which also hit a new low since June, indicating that after excluding some fluctuations, the data did show a downward trend.

The report also showed that in the week ending September 7, the number of consecutive applicants for unemployment benefits was 1.829 million, the lowest level in three months, lower than market expectations of 1.854 million and 1.843 million the previous week.

The number of initial jobless claims directly reflects changes in the number of unemployment insurance applicants, which means how many people are seeking government assistance because they have lost their jobs. Due to its high frequency, investors, policy makers, and economists can use this data to quickly understand changing trends in the labor market.

Initial jobless claims usually rise immediately if the job market deteriorates, so it is very useful in catching early signs of an economic downturn or improvement. Compared to that, the number of people employed in non-farm payrolls is more reflective of new employment opportunities. Although important, it is not as intuitive as the initial request for employment.

Jefferies analysts wrote that although this number has been gradually rising since this year, the increase has been very moderate, and it is difficult to see it as a sign of economic contraction. Given the challenge of finding talent, companies seem reluctant to opt for large-scale layoffs, instead choosing to reassign employees or shorten their working hours.

Influenced by positive initial data, the three major indices of the US stock market collectively rose at the beginning of the session. Among them, the Nasdaq Composite Index, which mainly focuses on technology stocks, surged more than 2.6%, while the Dow Jones Industrial Average rose nearly 1%; the S&P 500 index rose more than 1.6%, continuing to hit record highs.

S&P 500 daily chart

However, analyst Eliza Winger commented, “Unemployment claims data usually records lower numbers during the week shortened due to holidays, and then rebounds the next week — so the current data has limited reference value for predicting September's employment report.”

Overnight, the Federal Reserve announced a 50 basis point cut in interest rates and changed “steady” employment growth to “slow down” in the statement. However, Chairman Powell claimed at the press conference that the labor market is in good condition, and he hopes to maintain this state of affairs. Today's initial request also confirmed this statement.

In the “Economic Expectations Summary” (SEP), the Federal Reserve depicts a “soft landing” scenario. It is confident that the unemployment rate will remain at 4.4% at the end of this year and next year while reducing the PCE (personal consumption expenditure) inflation rate to the central bank's target of 2%.