US stocks extended declines Thursday as investors awaited fresh catalysts and an inflation report that may shape Federal Reserve policy https://t.co/mAFlrxb1k9 ...

Inflation & Monetary Policy - The latest inflation report indicates rising prices across key household categories like groceries [1] - The Fed initially anticipated inflation to increase due to tariffs, viewing it as a one-time price increase rather than an inflationary process [2] - The pass-through of tariffs into inflation has been slower and smaller than expected, and the labor market has softened [4] - The Fed acknowledges growing risks to its other mandate (likely employment) and is moving towards a more neutral policy [4] - The Fed's policy had been skewed toward inflation, but now sees downside risk in the labor market, prompting a shift toward a more balanced approach [6][9] Labor Market Concerns - The labor market is described as "interesting," with a need to reduce rates to become more neutral, which should benefit the labor market [7] - Younger people and minorities are having difficulty finding jobs, with a low overall job-finding rate [8] - The low hiring rate is a growing concern, especially if layoffs begin, as those laid off may struggle to find new employment [8][9] - A concern exists that low hiring rates could quickly translate into higher unemployment [8]