Labor Market Analysis - Private sector job growth swung positive in October to 42,000 from negative 29,000, with larger companies contributing more than midsize and smaller companies [1] - Alternative data, like that from ADP, suggests pre-existing trends in the labor market are continuing at a similar rate, with modest job creation and moderating wages [3] - Labor demand may not be as strong as desired from a cyclical perspective, indicating rates could be lower [4] - Changes to job creation levels due to policy changes like immigration are considered output gap neutral, as additional people both work and consume [6][7][8] - Low levels of growth may result from changing border policy, but monetary policy doesn't automatically respond to this [9][10] Monetary Policy Considerations - Monetary policy aims to balance supply and demand, avoiding both inflation and deflation [7] - Expansionary supply-side policies, like full expensing provisions from the tax bill, incentivize investment in new factory equipment and structures, pushing demand higher in the short run and expanding the supply side in the longer run [12][13][14] - Regulations shape the structure of the economy by influencing production possibilities and industry composition [15] - Monetary policy responds to the output gap, the outlook for inflation, and changes in the neutral rate [18] - An increase in national savings typically leads to lower interest rates [23] Inflation and Interest Rates - One perspective is that current policy is too restrictive, and a faster move to a neutral rate is preferred to avoid undue harm to the job market [25][26][28] - Tariffs are not viewed as a significant driver of inflation, and shelter/housing market inflation is expected to decrease more quickly than some colleagues anticipate [27][28] - High interest rates may already be causing a recession in parts of the economy, particularly housing [30] - The median projection from the September meeting suggested a third rate cut this year, implying a cut in December [35] - Core services inflation, when adjusted for imputed services like portfolio management fees, is closer to 2%, specifically 23%-24% [39][46] - Shelter disinflation is a critical factor in the inflation outlook, with expectations of benign shelter inflation due to market rents running at approximately 1% [47][49] Trade and Economic Uncertainty - Increased uncertainty over the tariff and trade environment could negatively impact the economy [21] - A ruling against the president's authority to issue tariffs could increase uncertainty, potentially pressuring growth and hiring [20][21]

I'm a little bit more concerned about the direction of inflation to be honest with you than I am employment. The Fed's got a much more difficult degree of landing because believe it or not, the Fed gets a weekly update of the ADP estimate. Most people don't understand that.So, the Fed's not flying blind when it comes to the labor market, right. Inflation's a little bit more difficult. They're probably going to be talking to the MIT Harvard billion uh prices project.and to get an idea of what's going on. The ...

Stagflation Definition and Components - Stagflation is defined as a combination of weak or negative growth, high unemployment, and high inflation [1] - Economic growth is measured by GDP (Gross Domestic Product), which tracks what's made inside US borders [2] - Inflation is tracked using CPI (Consumer Price Index), representing a household shopping basket, and PCE (Personal Consumption Expenditures), a broader measure favored by the Federal Reserve [3][4] - Job market health is assessed via the unemployment rate and monthly payroll changes reported by the Bureau of Labor Statistics, with weekly unemployment claims offering higher-frequency insights [5] Historical Context and Current Assessment - The 1970s experienced significant stagflation with unemployment exceeding 7-8%, double-digit inflation, and contracting GDP [6] - The pandemic period saw a different pattern: initial COVID impact led to unemployment spikes and GDP decline, but without immediate price increases (stag without flation) [7] - In 2022, stimulus measures contributed to inflation exceeding 9%, while the economy contracted modestly and unemployment remained low [7] - Currently, unemployment is moderate, PCE is in the high 2% range, and GDP is relatively strong, not indicative of 1970s-style stagflation [8] Market and Economic Indicators to Watch - Precious metals, such as gold (up over 40% this year) and silver (approaching 60%), tend to perform well during periods of elevated inflation and Federal Reserve interest rate cuts [8] - Key data points to monitor include jobs data, CPI, PCE, and GDP, with particular attention to services inflation (shelter, insurance, healthcare costs) [9] - Energy prices and the strength of the US dollar are important factors, as an oil price surge or a weaker dollar could quickly reignite headline inflation [9][10] - Real incomes (workers' paychecks after inflation) should be monitored relative to demand; a decline in savings and increased credit card usage could signal potential issues [10][11]

🚨Fed’s go-to inflation gauge (PCE) just dropped. All numbers came in exactly as expected!Core PCE MoM:🔹Actual: 0.2%🔹Forecasted: 0.2%Core PCE YoY:🔹Actual: 2.9%🔹Forecasted: 2.9% ...

Year-over-year core PCE inflation coming in as expected, up by 2.9% in August, but uh obviously it's still pretty sticky. Joining us right now on the implications for the Fed with all of this is Loretta Mester. She is former Cleveland Fed president and a junct professor now at the University of Pennsylvania.And Loretta, what do you think of these numbers. Maybe not hotter than expected, but but sticky nonetheless. Yeah, it was another month of stickiness and that isn't really what the Fed wants to see.I mea ...

Inflation Trends - The U S August 2025 Core PCE Price Index increased 29% year-over-year [1] - Overall PCE rose 27% year-over-year [1] - Overall PCE increased 03% month-over-month [1] Market Expectations - The U S August 2025 Core PCE Price Index year-over-year matched market expectations [1]

Core Insights - The article emphasizes the importance of conducting thorough due diligence before making any financial decisions, particularly in the context of investments and trading activities [1] Group 1 - The content includes general news and publications, personal analysis, and opinions intended for educational and research purposes [1] - It highlights that the information provided does not constitute any recommendation or advice for investment actions [1] - The article warns that the information may not be accurate or provided in real-time, and prices may be sourced from market makers rather than exchanges [1] Group 2 - The website discusses complex financial instruments such as cryptocurrencies and contracts for difference (CFDs), which carry a high risk of losing money [1] - It encourages individuals to perform their own research and understand the risks involved before investing in any financial instruments [1] - The article states that FX Empire does not endorse any third-party services and is not liable for any losses incurred from using the information provided [1]

Market Expectations - US PCE data is expected to be 27% [1] - Core PCE data is expected to be 29% [1] Market Impact - A bullish market is contingent on PCE and Core PCE data being lower than expected [1]

Market Overview - Futures are slightly lower at the start of the trading day, but there are lingering bullish tones in the market [1][5] - The market has experienced a significant run recently, indicating potential fatigue in pre-market futures [5] Earnings and Economic Data - Key earnings reports are expected this week, including Micron after the bell tomorrow and Costco on Thursday [2] - Important economic data will be released, including PMIs, durable goods, GDP revisions, jobless claims, and personal income and outlays [3][4] Federal Reserve Insights - A steady flow of Federal Reserve speakers is anticipated this week, discussing recent interest rate decisions and economic outlooks [4][10] - The probability of a 25 basis point cut in October is currently around 91.9%, with market expectations heavily influenced by upcoming economic data [12][14] Inflation and Labor Market - The consensus for the year-over-year PCE inflation rate is expected to tick up slightly to between 2.6% and 2.7%, while the core PCE is projected to remain flat at around 2.9% [13] - Ongoing labor market data will be crucial for future discussions on interest rates, with more job-related data expected in early October [14] Gold and Risk Sentiment - Gold prices are rising, attributed to a risk-off sentiment in the market and a weaker dollar [6][7] - The VIX is higher, indicating increased market volatility, while yields on 10-year notes have drifted lower [8][9]

Group 1 - The article does not provide any specific content related to a company or industry, as it appears to be a technical issue regarding browser settings and ad-blockers [1]