Applications for jobless benefits decline last week

WASHINGTON (AP) — The number of Americans applying for unemployment benefits came back down last week, hovering near levels suggesting the U.S. labor market has been largely unaffected by the Federal Reserve's aggressive interest rate hikes.

Applications for jobless aid fell to 225,000 for the week ending Nov. 26, a decline of 16,000 from the previous week's 241,000, the Labor Department reported Thursday. The four-week moving average of claims, which evens out week-to-week swings, inched up by 1,750 to 227,000.

Applications for unemployment benefits are a proxy for layoffs, and viewed with other employment data, shows that American workers are enjoying extraordinary job security at the moment, despite an economy with some glaring weaknesses.

To combat inflation that hit four-decade highs earlier this year, the Federal Reserve has raised its benchmark interest rate six times since March. The housing market has buckled under the strain of mortgage rates that have more than doubled from a year ago. Many economists expect the United States to slip into a recession next year with more Fed rate hikes expected to increase borrowing costs and slow economic activity.

Early this month, the Fed raised its short-term lending rate by another 0.75 percentage points, three times its usual margin, for a fourth time this year. Its key rate now stands in a range of 3.75% to 4%, the highest in 15 years.

On Wednesday, Fed Chair Jerome Powell said the central bank would push interest rates higher than previously expected and keep them there for an extended period until inflation was under control. Powell did add that the size and pace of those increases could be scaled back from the jumbo three-quarters of a point increases the Fed made at its last four meetings.

In spite of persistent...