Initial jobless claims came in at 217,000 for the week ending May 23, essentially unchanged from the prior week’s 215,000 and slightly below the consensus estimate of 220,000. Continuing claims edged up to 1.82 million, but remain well within the range the labor market has occupied for most of 2026. The four-week moving average of initial claims, a less volatile measure, held steady at 218,500 — its lowest since early April.
The data reinforces the narrative that the US labor market remains resilient despite elevated interest rates and geopolitical uncertainty. Claims have now held below 225,000 for 16 consecutive weeks, a streak that economists point to as evidence that layoffs remain historically low. ‘The labor market is not the source of concern here,’ said Ellen Zentner, chief economist at Morgan Stanley. ‘If anything, the tightness in claims data is one of the reasons the Fed feels comfortable staying on hold.’
In a separate release, the Bureau of Economic Analysis revised Q1 GDP growth up to 2.1% from the initial estimate of 1.8%, driven by upward revisions to consumer spending and business investment. The headline number was slightly above the 2.0% that economists had penciled in. The GDP price index was revised down to 3.0% from 3.2%, a modestly encouraging signal on the inflation front that markets greeted favorably.
The data pairing — sticky-low claims plus a slight GDP upgrade — provided the economic foundation that allowed equity markets to embrace the Goldman Sachs target upgrade without hesitation. Bond markets took the Q1 GDP revision as confirmation that the economy is growing at a sustainable, non-inflationary pace, which explains why the yield curve steepening Thursday was driven by risk appetite rather than inflation fears.
Friday brings the April personal income and spending report, including the PCE price index — the Fed’s preferred inflation gauge. Economists expect core PCE to print at 2.7% year-over-year, matching March’s reading. A print in line with expectations would likely keep the ‘good data is good data’ dynamic intact, while a downside surprise could add fuel to what is shaping up to be a strong finish to May for equities.
