U.S. initial jobless claims fell 10,000 to 196,000 in the week ended Sept. 12, below the 208,000 market expectation and the lowest level since July. Unadjusted claims reached their lowest point since 1969, while continuing claims declined 39,000 to 1.73 million, the lowest since January 2024. The four-week moving average fell to 203,250, its lowest level in five weeks. Labor Day and the start of the school year may have exaggerated the weekly decline, particularly in California, Texas, Michigan and New York. The data point to a labor market characterized by low layoffs and low hiring: existing workers face relatively strong job security, while job seekers encounter fewer opportunities. The Conference Board's survey of labor-market perceptions has deteriorated, highlighting a gap between stable employment stocks and weakening hiring flows. The claims data covered the reference period for September's nonfarm-payroll survey. Payrolls rose 162,000 in August after three weak months. The Federal Reserve raised its federal funds rate target by a quarter percentage point to 3.75%-4.00%, its first increase since July 2023, citing persistent inflation, while Chair Kevin Warsh described the labor market as a fundamental strength and said unemployment was essentially consistent with full employment. Further tightening could eventually weigh on hiring and employment stability.