Labor Market is not Source of Inflationary Pressure
Dow Jones
Yesterday
1036 ET - The Fed could once again be reassured that the labor market is not a source of inflationary pressure. Average hourly earnings rose just 0.1%. Year over year, earnings growth is down to 3%, the lowest since May 2021, according to Oxford Economics. One of the biggest concerns for the Fed is ensuring prices don't become more embedded in the economy. If inflation expectations become unanchored, consumers expect prices to keep rising and workers demand higher wages to compensate. "The thing about market measures of inflation expectations in economic history is that they tend to look strong and durable until they don't," Warsh said at his Jackson Hole speech.
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