The number of workers filing new applications for jobless benefits fell last week to the lowest level in about 17 months, according to U.S. government data on Thursday.
Initial claims for state unemployment benefits fell by 22,000 to a seasonally adjusted 432,000 in the week ended December 26, from 454,000 in the prior week, initially reported as 452,000, the Labor Department said.
Economists polled by Reuters expected 460,000 new claims in the latest week.
The new claims tally was the lowest since the week of July 19, 2008.
The U.S. labor market has shown some signs of healing after two years of heavy job losses as the economy pulls out of a deep recession. Some economists think December marked the first month in two years that there were more jobs created than destroyed.
(Reporting by Emily Kaiser, Editing by Neil Stempleman.)