US filings for unemployment benefits rose more than expected last week, underscoring a gradual softening in the labour market. Initial claims climbed by 11,000 to a seasonally adjusted 235,000 for the week ended Aug. 16, the highest level since June and above the 225,000 consensus forecast, Labor Department data showed on Thursday. Continuing claims, a proxy for the number of people receiving unemployment assistance, increased 30,000 to 1.972 million in the prior week, marking the highest reading since November 2021. The previous week’s continuing-claims figure was revised down to 1.942 million. The rise in claims adds to other indicators pointing to a cooler economic backdrop. The Federal Reserve Bank of Philadelphia’s August Manufacturing Business Outlook Survey slipped to –0.3 from 15.9 in July, missing economists’ projection of +6.5 and signalling a marginal contraction in regional factory activity. Measures of input costs accelerated, with the prices-paid gauge jumping to 66.8 from 58.8, while prices received edged higher to 36.1. Taken together, the data suggest hiring momentum is easing while cost pressures persist, a mix that analysts say could reinforce expectations for the Federal Reserve to deliver a quarter-point rate cut at its policy meeting next month. Investors will look to the August non-farm payrolls report, due Sept. 5, for further confirmation of the labour market’s direction.