Emre Yumlu 
US jobless claims were reported at 245,000. Market expectations were around 246,000, while claims in the previous week were recorded at 250,000.
The data came in slightly below expectations, indicating that the US labor market continues to show strength. This marks the second consecutive week of declining jobless claims.
Why Are US Jobless Claims Important?
This weekly data, which shows the number of individuals applying for unemployment insurance for the first time, is considered an important indicator of the health of the labor market. A decrease in claims suggests fewer layoffs and a resilient employment environment.
With the release of this week’s data:
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Expectations: 246K
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Previous Week: 250K
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Actual: 245K
What Do the Fed and Markets Think?
Inflation data released in May has shifted investors’ focus back to the possibility of a rate cut expected in September. The Consumer Price Index (CPI) rose only 0.1% on a monthly basis, falling short of expectations, while annual inflation came in at 2.4%, also below economists’ forecast of 2.5%. This soft inflation reading has strengthened expectations that the Fed may begin cutting interest rates in the second half of the year.
According to CME Group data, the probability of a rate cut in September has risen to 76%.
You May Be Interested: When Will the FED Cut Interest Rates? Pressure on Powell is Increasing!
However, this process is not shaped solely by economic indicators. President Donald Trump has escalated his criticism of Fed Chair Jerome Powell. Trump, calling Powell a “numbskull,” argued that a 2-point rate cut would save the US economy $600 billion. He also hinted that he might intervene if necessary. Several members of his administration echoed these sentiments—both the Secretary of Commerce and the Vice President voiced support for Trump’s position, stating that “the Fed must cut rates.”
So far, markets have remained calm in response to these statements. However, the growing political pressure is being closely watched in terms of the Fed’s independence and the decisions Powell will make in the coming period.
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