USD Up As Lower Jobless Claims Confirm Stable US Labor Market

The USD tumbled after some lower employment figures, but last week and today’s Unemployment Claims have shown that US employment is stable. Last week’s claims fell to 233K from 250 in the previous week, while this week the jobless claims fell to 227K, against 235K expected, which has calmed the fears of a deterioration in the labour market, sending the USD 50 pips higher.

Today’s economic data releases provided a snapshot of a strong U.S. labor and consumer market, with only a minor dip in manufacturing—a trend that mirrors global patterns. The key highlight was the July U.S. retail sales report, which rose by one percent, well above the expected 0.3%.

The weekly initial jobless claims for the period ending August 10, 2024, were reported at 227K, slightly below the revised 234K from the previous week and under the expected 235K. Continuing jobless claims came in at 1,864K, lower than the revised 1,871K from the prior week and the predicted 1,875K, reinforcing the view of a robust labor market. So, this shows that the July NFP report was impacted by Hurricane Beryl.

Overall, these figures don’t suggest the economy is on the brink of a recession and may not justify a 50 basis point September Fed rate cut in September. The market is now pricing in 94 bps of monetary policy easing for 2024, down from 104 basis points ahead of the data, while the probability of a 50 bps cut in September has decreased below 25%.

Weekly Initial Jobless Claims for the Week Ending August 10, 2024

• Initial Jobless Claims: 227K vs. 235K expected, 234K prior (revised from 233K).
• Continuing Jobless Claims: 1,864K vs. 1,875K expected, 1,871K prior (revised from 1,875K).

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Skerdian Meta

Lead Analyst

Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.

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