Fed Might Focus on Weakening Labor Market Rather Than Inflation as it Mulls Rate Cuts: Economists
Summary
Crypto and traditional markets rose after CPI report showed lower-than-expected price increases, raising hopes for Fed rate cuts. Despite hotter PPI data, traders are confident in rate cuts due to weakening labor market. Fed may ease policy before inflation hits 2% target. Unemployment rate rose to 4.1% in June. Fed Chair Powell acknowledged labor market slowdown and signaled potential rate cuts. However, rate cuts may not be as bullish as perceived due to potential investor shift from risk assets to safer investments in a weakening economy.
