Fed Confronts Dual Mandate Test | Presented by CME Group

Group 1 - The Federal Reserve is facing a dual mandate dilemma with headline inflation rising to 3% year-over-year in September, the highest since January, while the unemployment rate is at 4.3% [1] - Job gains have slowed, with revised data indicating 911,000 fewer positions created from April 2024 through March 2025 than previously thought, suggesting a slightly softer labor market [1] - Despite persistent inflation, the Fed has signaled a pivot by cutting rates at the September FOMC meeting, with a 96.7% chance of another quarter point trim at the upcoming October meeting [2] Group 2 - The Fed fund's target rate is expected to drop to 3.75% to 4%, even as core CBI remains at 3.1%, indicating a focus on supporting employment [2] - The decision to prioritize employment over inflation concerns reflects the Fed's balanced approach to prevent deeper economic problems in the future [2]