Applications for US unemployment benefits fell last week to 208,000, suggesting the labor market remains stable despite ongoing economic uncertainty. The decline came in below forecasts and signals continued resilience in hiring conditions.

Initial jobless claims decreased from the previous week's revised level, marking a notable drop that surprised economists who had anticipated a higher figure. The data reinforces the view that layoffs remain low and businesses are retaining workers.

The four-week moving average, which smooths weekly volatility, also edged lower, underscoring the underlying strength. Continuing claims for the week ended earlier showed a modest increase, but remain at historically low levels.

Federal Reserve officials will likely view this report as supportive of their assessment that the labor market is cooling gradually without a sharp deterioration, keeping policy options open for upcoming meetings.