Dec 26 2015

Rate Range Projection by Bank

Next Year  110.00 to 127.00

The number of Americans filing for unemployment benefits fell more than expected last week, nearing a 42 year low as labor market conditions continued to tighten in a boost to the economy.

Initial claims for state unemployment benefits dropped 5,000 to a seasonally adjusted 267,000 for the week ended Dec.19, not far from levels last seen in late 1973, the Labor Department said on Thursday.

Economists polled by Reuters had forecast claims dipping to 270,000 in the latest week. Claims have been below 300,000, a threshold associated with a buoyant labor market, for 42 consecutive weeks. That is the longest stretch since the early 1970s.

Still, labor market strength is helping to underpin consumer spending, supporting the economy as it deals with the headwinds of a strong dollar, slowing global growth, spending cuts by energy firms and an inventory overhang.

Prices of longer dated US government debt rose after the data, while the dollar pared some losses. USstock index futures were slightly higher.

A Labor Department analyst said there were no special factors influencing the data and that no states had been estimated.

The unemployment rate is in a range many Federal Reserve officials see as consistent with full employment. It has dropped seven tenths of a percentage point this year.