Core Viewpoint - Federal Reserve Chairman Jerome Powell's recent speech at the NABE annual meeting indicated a shift in monetary policy, with a strong likelihood of interest rate cuts in the coming months, reflecting concerns over the labor market and inflation pressures [2][3][4]. Group 1: Employment Data - Recent non-farm payroll data showed weakness, failing to meet market expectations, with the unemployment rate rising to a year-high of 4.3% [3]. - The ADP data corroborated this trend, showing a decline in employment numbers over the past three months, with negative growth reported in September [3]. Group 2: Monetary Policy Changes - Powell signaled that the Fed may stop its balance sheet reduction in the coming months, marking a potential end to three years of monetary tightening [3]. - This shift aims to ease liquidity constraints and create a more favorable environment for future interest rate cuts, indicating a transition from a focus solely on combating inflation to balancing growth and employment [3]. Group 3: Inflation Concerns - Despite the dovish signals, Powell reiterated concerns about inflation, particularly the impact of tariffs on price pressures, suggesting that ongoing trade conflicts could complicate the timeline for rate cuts [4].