Higher Jobless Claims Overshadow Inflation, Stirring Economic Uncertainty

Rising Jobless Claims Shift Market Attention from Inflation

U.S. jobless claims surged to 263,000 last week, the highest since 2019, underscoring a cooling labor market and renewed stagflation fears. Investors shrugged off August CPI data showing headline inflation at 2.9% and core inflation at 3.1%, both above the Fed’s 2% target.

The spike in claims moved markets: the 10-year Treasury yield fell below 4% for the first time since April, reflecting heightened caution. Crypto markets responded similarly, with Bitcoin and Ether modestly higher, while altcoins saw stronger gains — Solana up 11%, Dogecoin 17%, and XRP 6.6% — suggesting traders are anticipating easier monetary policy.

Economists warn that policymakers face a delicate choice: easing rates could stoke inflation, while maintaining policy risks slowing growth further. “It’s going to be a rough few months ahead as tariffs’ impacts work through the economy,” said Heather Long of Navy Federal Credit Union.