The US labor market’s fine. “Solid.” “Resilient.” Any synonym for “sturdy” will work.

Thursday’s sole US macro release — and the last fundamental data readout of this week’s very sparse docket — was remarkable. Initial US jobless claims printed just 227,000 for the week to July 5, below estimates and the fewest since mid-May.

Remember when it looked as though claims had finally reset higher? Well, that was a false alarm. Another one. I long ago lost track of how many times macro doomsayers (a camp I venture into myself on occasion) thought they saw a worrying inflection in the initial filers series, only to see it vanish in subsequent weeks.

Recall that the four-week moving average made it all the way up to 245,750 midway through last month, the highest since August of 2023. With Thursday’s update, it’s back down to 235,500, and if next week’s claims headline comes in low, it’ll fall considerably further given that the last of three consecutive > 245,000 prints will drop from the lookback.

This isn’t “news,” per se, but it’s well worth a mention, and not just because there isn’t much else to say on an otherwise data-less summer Thursday. The June FOMC minutes, released mid-week, underscored a divide on the Committee between those who’re open to cuts as soon as this month, and those who doubt the case for any cuts at all in 2025.

I personally think it’s best to go ahead and resume gradually dialing back whatever’s left of policy restriction. There’s not a great case to be made for staying well north of neutral, and as discussed here on any number of occasions recently, it’s fair to suggest short run neutral’s much closer to long run neutral than it was as late as last year. If long run, nominal neutral’s ~3%, the Fed could cut three times and still claim to be mildly restrictive.

That said, data points like Thursday’s support Jerome Powell’s view that there’s no urgency at all. 227,000 on the initial filers headline is very low, which is to say taken in isolation, it’s a print suggestive of a tight labor market.

Anyway, continuing claims for the week to June 28 printed 1.965 million in Thursday’s release. That was bang-on estimates, and another “since November of 2021” high.