BLS DAILY REPORT, FRIDAY, JANUARY 17, 1997 ETA reports initial claims filed with state agencies for unemployment insurance benefits fell 32,000 to a seasonally adjusted total of 323,000 during the week ended Jan. 11 ....(Daily Labor Report, page D-1)_____The level was the lowest in nearly three months ....(Washington Post, page G7). Federal Reserve Board Governor Laurence Meyer suggested that the central bank may have to raise interest rates if the nation's unemployment rate declines. "At the prevailing unemployment rate, the challenge is to be especially watchful for early signs of mounting price pressures and, if necessary, to be at least swiftly reactive to limit and then reverse any acceleration of inflation that might occur," Meyer told the Economics Club of Charlotte. "If the unemployment rate declines, however, a more forward-looking approach may quickly become appropriate." Meyer added that given current low jobless rates, he has "slightly greater concern" that inflation will increase than that the economy will lapse into a persistent, slow-growth period and face rising unemployment and further disinflation ....(Daily Labor Report, page A-7)_____In reporting Meyer's speech, the Washington Post (page G1) says that senior Federal Reserve officials appear unlikely to raise short-term interest rates anytime soon as a precaution against a resurgence of inflation triggered by the extremely tight labor markets. The policymakers are still not entirely sure why inflation has remained so low despite a 5.3 percent unemployment rate. As a result, they will raise rates only if there are clear signs the situation is changing for the worse -- and at the moment there are none, according to a number of Fed officials ....A key figure for Fed officials will be the employment cost index for the final three months of last year, which is to be released Jan. 29. The ECI is widely regarded as the single best measure of trends in labor costs. Should it show a unexpectedly sharp increase, it might persuade Fed officials to consider raising rates when they meet for a two-day policymaking session starting Feb. 4 .... CORRECTION: The Wall Street Journal editorial cited in yesterday's Daily Report should have credited "Facts on Working Women" to the Women's Bureau rather than to BLS.
