The number of Americans filing for unemployment benefits unexpectedly fell last week, hitting its lowest level in more than 48 1/2 years, as the labor market continues to strengthen.
Other data on Thursday showed manufacturing activity in the mid-Atlantic region accelerated in July, driven by a surge in new orders received by factories. But manufacturers reported paying more for inputs.
They were less upbeat about business conditions and capital expenditures over the next six months, a sign that import tariffs were starting to hurt business sentiment.
Initial claims for state unemployment benefits dropped 8,000 to a seasonally adjusted 207,000 for the week ended July 14, the lowest reading since early December 1969, the Labor Department said.
Economists polled by Reuters had forecast claims rising to 220,000 in the latest week.
The second straight weekly decline in claims, however, likely reflects difficulties adjusting the data for seasonal fluctuations around this time of the year when motor vehicle manufacturers shut assembly lines for annual retooling.
With manufacturers undertaking the retooling exercise at different times in July, this can throw off the model that the government uses to the smooth the claims data for seasonal variations.
The Labor Department said only claims for Maine were estimated last week. U.S. financial markets were little moved by the data.