WASHINGTON (Reuters] – Last week saw a slight increase in the number of Americans filing for unemployment benefits. It is a sign that the labor market recovery has been gaining momentum.

According to the Labor Department, initial claims for unemployment benefits dropped 17,000 to a seasonal adjusted 232,000 during the week that ended February 19, according the Labor Department. Reuters economists had predicted 235,000 application for the most recent week.

The week ended Feb. 12 saw a rise in claims. This was attributed by economists to the volatility of the data week-to-week and delayed impacts from winter storms in early February.

There were a record 10.9million job opportunities at December’s end. Layoffs are not common and economists predict claims will fall below 200k in the next few weeks. In December, they were at their lowest level since early December.

Federal Reserve officers often consider the labor market to be at maximum or close to it.

The number of claims has fallen from 6.149 million, a record in April 2020. Inflation is being driven by high wage growth due to tighter labor markets.

However, rising wages and improved job security will help sustain consumer spending, as well as underpin the economy’s expansion, even if the Fed raises interest rates to lower inflation and the government stops giving money to businesses and households. Economists predict seven rate hikes by the U.S. central banks this year.

The Commerce Department released a separate report on Thursday that confirmed economic growth in the fourth quarter. It was also helped by the reduction of COVID-19 infected over the summer due to the Delta variant.

According to the second estimate of GDP, gross domestic product grew at 7.0% per annum last quarter. This was slightly higher than the 6.9% previously reported. 3.3% was the economy’s growth rate in third quarter.

However, the economic momentum seemed to be waning by December due to a strong backwind from Omicron-related coronavirus infections. However, the Omicron variant has slowed down and activity has resumed.

Data showed that retail sales rose in January, while business activity increased in February. This has put at risk GDP growth estimates for first quarter, which were mostly lower than 2.0.

According to a Reuters analysis, the average number of new COVID-19 infection cases in America is now 80,131 per day. This contrasts with mid-January’s more than 700,000.