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Why the Fed Is Watching the Labor Market Tightness Number

Why the Fed Is Watching the Labor Market Tightness Number

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Lucas and Luna break down why the Federal Reserve is zeroing in on a specific labor market metric: the ratio of job openings to unemployed workers. With the Fed funds rate stuck at 3.64% and core PCE inflation at 3.3%, the hosts explain how this single number — which has dropped from 2:1 to 1.2:1 — could determine whether the Fed cuts rates in 2026. They discuss recent comments from Minneapolis Fed President Neel Kashkari, the impact of the Iran war on energy prices, and why the labor market remains surprisingly resilient despite geopolitical shocks. Lucas argues that the openings-to-unemployed ratio is the key signal for rate policy, while Luna challenges whether the metric captures the full picture for workers. The episode ties together data from the JOLTS survey, April CPI, and the ten-year yield at 4.45% to make a case for why this one ratio matters more than headlines about consumer sentiment. #FederalReserve #FOMC #LaborMarket #JobOpenings #Unemployment #MonetaryPolicy #InterestRates #CorePCE #Inflation #Kashkari #JOLTS #EnergyPrices #IranWar #TenYearYield #RateCut #EconomicData #Economics #FexingoBusiness Keep every episode free: buymeacoffee.com/fexingo
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