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US Jobless Claims Drop to 198,000, Beating Forecasts

Seasonal quirks likely explain the dip in filings, keeping expectations for a steady Fed.

Overview

  • Continuing claims fell by 19,000 to 1.884 million, pointing to stable insured unemployment.
  • The four-week average declined to about 205,000, the lowest since January 2024 and a cleaner signal than the weekly move.
  • Economists caution that year-end seasonal adjustment noise makes a single week’s decline hard to interpret.
  • Stocks gained after the release, with the S&P 500 and Nasdaq rising as Treasury yields moved higher.
  • Futures pricing indicates a high probability that the Federal Reserve will hold rates at 3.5%–3.75% at its next meeting.