Data on Thursday showed that the number of Americans filing for unemployment benefits fell last week, pointing to a persistent strength of the labor market even as economic activity appears to have slowed in the first quarter.
On Thursday, data showed a rise in the prices of imported goods in February mainly due to the weakness of the U.S. dollar, reinforcing expectations that inflation will pick up this year. A strong labor market and a steady increase in prices would be in focus in the FOMC meeting of next week.
According to the Labor Department on Thursday, for the week ended March 10, the initial claims for state unemployment benefits dropped by 4,000 to a seasonally adjusted 226,000. During the week ended February 24, claims decreased to 210,000 which was the lowest level since December 1969.
It has been the 158th straight week that claims remained below the 300,000 threshold, which is associated with a strong labor market. Such a long stretch was last seen in 1970, when the labor market was much smaller.
Fed policymakers consider the U.S. labor market to be near or even a little past full employment. The unemployment rate is sitting at 4.1%, a 17-year low. In February, the economy created 313,000 jobs. Economists are optimistic that tightening labor market conditions will boost wage growth in the second half of this year.