[Asia Economy New York=Special Correspondent Joselgina] Despite concerns about an economic recession and consecutive corporate layoffs, additional indicators show that the US labor market remains resilient.
According to the US Department of Labor on the 26th (local time), the number of new unemployment insurance claims for the week of January 15?21 decreased by 6,000 from the previous week to 186,000. This is the lowest level since April last year and also below Wall Street's forecast. Initially, Wall Street had expected last week's unemployment claims to increase by 15,000, exceeding 200,000.
Although layoffs have accelerated since the second half of last year, especially in tech companies and interest rate-sensitive sectors such as housing, recent employment indicators suggest that the labor market remains robust. Following Amazon and Google Alphabet, IBM announced the day before that it would lay off 3,900 employees, accounting for 1.5% of its total workforce.
With the labor market still showing strength, attention is focused on next week's Federal Reserve (Fed) Federal Open Market Committee (FOMC) meeting. The market continues to expect that the Fed will narrow the rate hike to 0.25 percentage points at the February FOMC. According to the Chicago Mercantile Exchange (CME) FedWatch, the federal funds (FF) rate futures market currently reflects more than a 98% probability of a 0.25 percentage point rate hike in February.
Meanwhile, the number of continuing unemployment claims, which are filed by those claiming unemployment benefits for at least two weeks, increased by 20,000 to 1.68 million. This data is based on two weeks ago.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
