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The number of Americans filing applications for unemployment benefits dropped from more than a two-year high last week, pointing to sustained labor market strength.

CNBC reported that initial claims for state unemployment benefits decreased 18,000 to a seasonally adjusted 234,000 for the week ended Dec. 14, the Labor Department said today (Dec. 19).

Though the drop did not unwind the prior week’s jump of 49,000, it likely does not indicate a material shift in labor market conditions as claims data tend to be volatile in the period following the Thanksgiving Day holiday.

The prior week’s surge, which boosted claims to 252,000 — the highest reading since September 2017 — probably reflected a late Thanksgiving Day this year compared to 2018. That could have thrown off the model used by the government to strip out seasonal fluctuations from the data.

Economists polled by Reuters had forecast claims would fall to 225,000 in the latest week. They expect claims to remain elevated relative to October’s low reading given volatility in the data around the holiday season and end of the year.

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