USD flows: Initial claims drop to 3 year low

Initial jobless claims continue to decline to 191k in the latest week’s data for the week ending November 29 – the lowest since September 2022. Continuing claims also fell on the week, but remain at a high level. The low level of initial claims suggests there is no serious deterioration in the employment situation, but the persistence of high continuing claims indicates no great enthusiasm to hire. The data are more USD supportive than the ADP employment and Challenger job loss numbers released this week, and the USD is modestly firmer. But it still seems odds on that the Fed will be easing next week, so we wouldn’t expect any major USD recovery.