Core Viewpoint - The Federal Reserve is nearing the timing for interest rate cuts due to signs of a weakening U.S. labor market and a lack of sustained inflation driven by tariff policies, with expectations for more than two rate cuts this year [1][2]. Group 1: Labor Market and Employment Data - The U.S. non-farm payroll report showed only 73,000 jobs added in July, with significant downward revisions of 258,000 jobs for May and June combined, marking an unprecedented 90% downward adjustment [1]. - The unemployment rate rose slightly by 0.1 percentage points to 4.2%, but the overall labor market indicators suggest a clear softening compared to last year [3][4]. Group 2: Federal Reserve's Interest Rate Decisions - The probability of a rate cut in September is approaching 90%, a significant increase from less than 40% prior to the employment report [1]. - The Federal Reserve's decision to maintain the short-term borrowing cost in the 4.25%-4.50% range was supported by some members, but there is a growing consensus that rate cuts may be necessary soon [2][3]. Group 3: Economic Indicators and Future Outlook - Key economic data, including labor market and inflation reports, will be released before the September FOMC meeting, influencing the decision on rate cuts [3]. - The Fed is in a "balancing zone," needing to ensure monetary policy continues to exert downward pressure on inflation while supporting sustainable employment growth [5].