In September, retail sales increased by 0.4%, surpassing expectations, while jobless claims decreased.

• The seasonally adjusted retail sales increased by 0.4% in September, surpassing the 0.1% increase in August and beating the 0.3% forecast by the Dow Jones.
• The number of initial unemployment claims filed was 241,000, which is 19,000 less than expected and lower than the estimate of 260,000.

The Commerce Department reported on Thursday that consumer spending in September remained stable, indicating a robust economy that is being supported by the Federal Reserve.

The advanced report shows that retail sales rose by 0.4% in September, surpassing the 0.1% increase in August and beating the 0.3% forecast by the Dow Jones, despite being seasonally adjusted.

Despite the 0.2% increase in inflation, sales accelerated at a better-than-forecasted rate of 0.5% after adjusting for seasonal factors.

The Labor Department reported that initial unemployment claim filings totaled 241,000 on Thursday, a decline of 19,000 and lower than the estimated 260,000.

Despite the devastation caused by hurricanes Helene and Milton, which caused billions of dollars in damages in the Southeast, filings in Florida and North Carolina decreased after a slight increase the previous week, according to unadjusted data.

Stock market futures were higher after the reports while Treasury yields also rose.

Despite indications of weakening in the labor market during the summer, consumers, who account for about two-thirds of economic activity in the U.S., continue to spend.

Miscellaneous store retailers, clothing stores, and bars and restaurants experienced growth, with spending increasing by 4%, 1.5%, and 1% respectively. This growth offset a 1.6% decline at gas stations due to falling fuel prices, as well as declines of 3.3% at electronics and appliances stores and 1.4% at furniture and home furnishing businesses.

Compared to the CPI rate of 2.4% for the same period, sales only increased by 1.7% from a year ago.

The Fed reduced its benchmark borrowing rate by half a percentage point and hinted at more cuts this year and in the next five years.

Despite strong September payrolls growth and weekly claims that have remained stable after the storm, policymakers are concerned that the labor market is softening. They believe that inflation will eventually return to the Fed's 2% target, but they are closely monitoring the situation.

On Thursday, the European Central Bank decreased its key deposit rate by a quarter point while expressing optimism about inflation, but also expressing worries about a broader economic slowdown.

Although the initial filings decreased, continuing claims, which are a week behind, increased to 1.867 million. Additionally, claims decreased by 7,812 in Michigan, which was affected by both storms and the Boeing strike.

The Philadelphia Fed's manufacturing activity index for October increased to 10.3, indicating expansion over contraction, and exceeded the predicted 3.0 estimate, up from September's 1.3 reading.