Falling unemployment in US shows strong market

The number of Americans filing for jobless benefits fell last week and layoffs in December were the smallest in 15-and-a-half years, pointing to labour market strength even as growth appears to have slowed sharply in the fourth quarter.

Coming on the heels of a Wednesday report showing private payrolls in December notched their biggest increase in a year, the data yesterday suggest that the economy’s fundamentals remain healthy as it struggles against the headwinds of a strong dollar, bloated inventories and energy sector investment cuts.

“The data are supportive of continued job gains. You don’t go into a recession with jobless claims and layoffs at these low levels,” said Jacob Oubina, senior economist at RBC Capital Markets in New York.