The number of workers filing for unemployment benefits in the U.S. remained near the lowest level in eight months, signaling resilience in the job market.

Initial claims for the week ended Sept. 30 rose to a seasonally adjusted 207,000 from a revised 205,000 in the previous period, the smallest number since the end of January, the Labor Department said in a statement. The four-week moving average fell to 208,750 from 211,250, according to the report.

Ohio and Michigan were among the states with the biggest gains in new claims, trailing only California. Those increases may be an indication of the impact of the United Auto Workers strike. More than 25,000 employees of Ford, General Motors and Stellantis have joined the walkout since it started on Sept. 15. The strike has affected automakers' units in those states.

Traders are keenly awaiting the release of key US jobs data later Friday, hoping for a slowdown in hiring that will give the Federal Reserve room to hold off another hike this month
Jobless claims continue to show strength in US labor market AFP

The Labor Department releases Friday the job report for the month of September, which is the most-expected economic data this week. Economists surveyed by Reuters estimate that total nonfarm payrolls rose by 170,000 last month from 187,000 in August.

On Wednesday, payroll processing company ADP said the number of new jobs in the private sector of the U.S. had the smallest gain since January 2021, an indication of a possible cool-down in the labor market. The figure for September was 89,000, about half of the 180,000 of August.

A less heated job market could provide an argument for the Federal Reserve to suspend its interest-rate hiking cycle, even though officials from the bank have signaled that another increase is likely this year to fight persistent inflation.

The Fed maintained the US benchmark rate in the range of 5.25% to 5.50% on Sept. 20, the highest level in 22 years.

The core Personal Consumption Expenditure (PCE) index, which is closely followed by policy makers to decide on interest rates, rose 3.9% in the 12 months through August, from 4.3% in July. Despite the slowdown, the measure is still way above the Fed's target annual inflation of 2%.