STORY: The number of Americans filing new claims for unemployment benefits rose last week to the highest level in more than eight months, further evidence that the labor market is cooling.
The weekly jobless claims report from the Labor Department on Thursday is considered the most timely data on the health of the economy.
It follows reports last week which showed the economy added the fewest jobs in six months in April while job openings dropped to a three-year low in March.
One economist tells Reuters the data hints at caution on the part of companies as they weigh the outlook for the second half of the year.
Expectations for an interest rate cut from the Federal Reserve at its September policy meeting rose slightly to 50% after the release of weekly jobless claims according to the CME FedWatch tool.
The Fed last week left its benchmark overnight interest rate unchanged.
Initial claims for state unemployment benefits increased 22,000 to a seasonally adjusted 231,000 for the week ended May 4, the highest level since the end of last August.
