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Initial Jobless Claims Plunge to 206,000, Beating Market Expectations and Dispelling Weather Interference Gloom

By AI Insights

2026-02-20

Trend analysis based on the updated indicator. View the Indicator→

Core Overview: Data Stabilizes, Beating Consensus

For the week ending February 13, US initial jobless claims were reported at 206,000, a sharp decrease of 21,000 from the previous week's 227,000. This figure not only ended a two-week rising trend but also significantly outperformed the general market expectation range of 223,000 to 225,000. This is also the lowest level since the end of last December, indicating that the job market is not deteriorating rapidly as implied by data from previous weeks.

Key Details: Smoothing Volatility and Corrections

According to the data, the 4-week moving average, which better reflects long-term trends, edged down to approximately 219,000, erasing part of last week's gains. Furthermore, data from the previous two weeks (late January to early February) had briefly surged above 230,000, mainly influenced by blizzard weather in certain states (such as Pennsylvania and New York) and difficulties in seasonal adjustments; the sudden drop in this week's data confirms that the previous surge was short-term noise rather than the beginning of a structural wave of layoffs.

Deep Attribution: The Balance of Low-Hire and Low-Fire

Institutional analysis points out that the current labor market is in a balanced state of "Low-hire, Low-fire." Research perspectives from J.P. Morgan and Stanford SIEPR suggest that while corporate hiring willingness has decreased with economic uncertainty, employers are extremely reluctant to implement large-scale layoffs in order to retain skilled labor. The "mean reversion" phenomenon in this week's data further confirms that when facing a high-interest-rate environment, companies still tend to control costs through attrition (not filling vacancies) rather than direct layoffs.

Outlook and Risks: Inflation Concerns and Rate Cut Path

Short-term Outlook (1-2 months): As initial jobless claims return to the historical low range (200,000-210,000), it may strengthen the Federal Reserve's (Fed) concerns about an overheating labor market, thereby postponing market expectations for rate cuts in the first half of 2026. Close attention is needed to see if data in the coming weeks establishes a floor near 210,000.
Medium-term Outlook (3-6 months): Although the layoff rate is low, if the hiring rate remains sluggish, there is still a risk of the unemployment rate creeping up. J.P. Morgan predicts the unemployment rate may peak at 4.5% in 2026. Investors should focus on whether "continuing jobless claims" show a trend-based rise, as this is the true signal of a weakening job market.

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