In this morning’s data, Initial Jobless Claims were 187,000 for the week ending March 19th, lower than expected and at levels not seen in decades. Continuing Claims were 1,350,000 for the week ending March 12th, also lower than expected and less than the previous week. Overall, initial claims indicate a tight labor market as they remain well below the 300k level considered normal for a healthy economy even as more individuals return to work amidst waning virus concerns. These conditions give freedom to the Federal Reserve to focus on inflation by tightening policy, including interest rate increases and reducing the size of their balance sheet, as Fed members have recently discussed. The speed of these adjustments will be key as inflation appears embedded in several areas of the economy and geopolitical risks have increased with the conflict in Ukraine. In all, the 10-year US treasury yield ticks higher and equity futures are also higher as we head into the market open.
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