Jobless Claims Slide to Post-1969 Low as Regional Manufacturing Shows Mixed Signals — Evening Brief – 07.23.26
U.S. jobless claims fell sharply in the week ended July 18, while regional factory surveys sent a mixed message on the health of the economy. The Labor Department reported that initial claims dropped by 22,000 to 187,000, well below the 211,000 consensus and down from 209,000 the prior week, revised from 208,000. The reading marked the lowest level for weekly claims since 1969, underscoring how little layoffs have changed even as broader economic uncertainty persists.
The four-week moving average fell to 207,500 from 214,750, while continuing claims edged down to 1.796 million in the week ended July 11 from 1.798 million a week earlier, revised from 1.805 million. The insured unemployment rate was unchanged at 1.2%, suggesting the labor market remains stable despite signs of cooling in some corners of the economy.
Separate economic reports painted a picture of moderate but uneven growth. The Chicago Fed National Activity Index (CFNAI) improved to -0.02 in June from a revised -0.19 in May, signaling economic activity remained near its long-run trend. The three-month moving average also improved to -0.05 from -0.10.
Personal consumption and housing made the largest positive contribution to the index, while production and employment remained modest drags. Of the 85 indicators comprising the index, 40 contributed positively and 45 negatively.
Meanwhile, manufacturing activity in the Tenth Federal Reserve District moderated. The Kansas City Fed Composite Index eased to 9 in July from 11 in June, missing the consensus estimate of 13. Durable goods manufacturing, led by electrical equipment producers, continued to expand, while food manufacturing weighed on nondurable output.
Despite the slower pace, manufacturers remained optimistic. The Kansas City Fed’s future composite index climbed to 20, its highest level since July 2022, reflecting stronger expectations for production and shipments in the months ahead.