The number of Americans filing new claims for jobless benefits fell last week, showing no signs that recent financial market turmoil following the failure of two regional banks is having an impact on the economy.
Initial claims for jobless benefits fell 1,000 to a seasonally adjusted 192,000 for the week ended March 18, the Labor Department reported on Thursday. Economists polled by Reuters had forecast 197,000 claims for the latest week.
Jobless claims have rebounded in a tight range this year, remaining low by historical standards, despite being squeezed by layoffs by major tech companies.
With 1.9 job vacancies for every unemployed person in January, employers are generally reluctant to let go.
Economists expect labor market conditions to ease, especially following the collapse of Silicon Valley Bank in California and Signature Bank in New York. The current financial situation is causing banks to tighten their credit, potentially impacting households and small businesses, which have been the main drivers of job growth.
This was also acknowledged by the Federal Reserve, where the Fed raised its benchmark overnight interest rate by a quarter of a percentage point, but indicated it was on the verge of halting further increases in borrowing costs.
U.S. central bank has raised its policy rate by 475 basis points since last March from near zero to the current 4.75%-5.00% range. Fed Chairman Jerome Powell said that "the events of the last two weeks are likely to result in some tightening of credit conditions for households and businesses, while at the same time weighing on labor market demand and inflation."
Claims changed little between the February and March survey weeks. The economy created 311,000 jobs in February after adding 504,000 in January.
