- Janet Yellen, Fed chairwoman
Despite the fact that the number of Americans seeking unemployment aid increased last week after plummeting to the lowest level in 14 years earlier in the month, the underlying trend still points to a continuing strengthening of the U.S labour market conditions. Initial jobless claims rose 23,000 to 302,000 in the seven days ended July 26, according to the Labor Department. The previous week's claims were revised to show 5,000 fewer applications received than previously recorded, totalling 279,000. Claims for the week ended July 19 reached the lowest point since May 2000. The big decline in claims earlier in July was probably caused partly by annual summer shutdowns by some major U.S. manufacturers to retool their plants for new production. The four-week moving average of claims, which smoothes out weekly volatility, fell 3,500 to 297,250, the lowest since April 2006. The Fed policymakers on Wednesday acknowledged the improvement in labour market conditions, but said "significant underutilization of labor resources" remained.
The Federal Reserve, which has a mandate to boost employment while keeping inflation under control, is closely watching the labour market data as it scales back its bond-buying programme and starts to debate when to raise interest rates. Following its policy meeting this week, the central bank announced it would wind down its purchases of mortgage and Treasury bonds to $25 billion a month.
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