WASHINGTON, March 15 — The number of Americans filing for unemployment benefits fell last week, pointing to sustained labour strength even as economic growth appears to have slowed early in the first quarter.

Other data today showed a rise in the prices of imported goods in February amid US dollar weakness, bolstering expectations that inflation will pick up this year. Labour market strength and a steady increase in price pressures could allow the Federal Reserve to raise interest rates next week.

Initial claims for state unemployment benefits dropped 4,000 to a seasonally adjusted 226,000 for the week ended March 10, the Labor Department said today. Claims decreased to 210,000 during the week ended Feb. 24, which was the lowest level since December 1969.

Last week’s drop in claims was in line with economists’ expectations. It was the 158th straight week that claims remained below the 300,000 threshold, which is associated with a strong labour market. That is the longest such stretch since 1970, when the labour market was much smaller.

Fed officials consider the labour market to be near or a little beyond full employment. The unemployment rate is at a 17-year low of 4.1 per cent.

The economy created 313,000 jobs in February. Economists are optimistic that tightening labour market conditions will boost wage growth in the second half of this year.

That should help to underpin consumer spending, which slowed at the start of the year. Data yesterday showed retail sales fell in February for a third straight month.

Gross domestic product growth estimates for the first quarter are as low as a 1.7 per cent annualised rate. Reports on home sales and industrial production in January have also been weak. The economy grew at a 2.5 per cent pace in the fourth quarter.

The US dollar gained against a basket of currencies after today’s data while US stock index futures moved higher. Prices of US Treasuries were trading mostly lower. Diminishing labour market slack is also expected to help boost inflation toward the US central bank’s 2 per cent target.

Imported capital goods prices rise

In another report, the Labor Department said import prices increased 0.4 per cent last month after accelerating 0.8 per cent in January. That lifted the year-on-year increase in import prices to 3.5 per cent from January.

Last month, prices for imported capital goods jumped 0.6 per cent. That was the biggest increase since April 2008 and followed an unchanged reading in January.

Prices of imported consumer goods excluding automobiles rose 0.5 per cent, the largest gain since January 2014, after edging up 0.1 per cent in the prior month. These price increases likely reflected the dollar’s depreciation against the currencies of the United States’ main trading partners, and will eventually filter through to core producer and consumer inflation.

Imported petroleum prices fell 0.5 per cent in February, the first drop in seven months, after rising 3.0 per cent in January. Import prices excluding petroleum surged 0.5 per cent after a similar gain in January.

The price of goods imported from China rose 0.2 per cent. Prices for imports from China increased 0.3 per cent in the 12 months through February, the biggest advance since June 2014. — Reuters