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Powell Hints at Further Rate Cut Support as U.S. Job Market Cools

5 hours ago

On October 15th, as per the report in the Financial Times, Federal Reserve Chairman Powell gave a warning on Tuesday. He stated that the US labor market is presenting more indications of distress, hinting that he might be prepared to back another rate cut later this month. Powell pointed out, "The downside risks to employment have grown." This is the most emphatic indication thus far that Fed officials believe they have sufficient evidence to support another 25-basis-point cut in the US borrowing cost. Powell further added that even without the new data from the Labor Department (which was postponed due to the government shutdown), privately generated labor market indicators and internal Fed research offer adequate grounds to believe that the job market is cooling off. "The existing evidence" indicates that "layoffs and hiring remain at low levels," while "households' perspectives on job opportunities and businesses' views on recruitment difficulties continue to decline." These remarks suggest that Powell is becoming more inclined towards a dovish monetary policy. (FXStreet)
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