This Week's Wage Data Critical for Gauging Inflation and Fed Policy
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Labor market data this week will provide critical insight into wage growth and inflation ahead of the Fed's rate decision later this month.
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Strong January wage growth could indicate an inflationary price-wage spiral is unfolding if February data confirms.
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Tight labor supply, with near record job openings, signals persistent inflationary pressures.
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Markets are complacent on inflation outlook, expecting 3 rate cuts in 2024 despite labor inflation signals.
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If wage data remains hot, markets may reprice higher rates, challenging the Fed's dovish pivot and sparking an equity/bond correction.