Slower Wage Growth Signals Inflation Cooling, Gives Fed Room to Pause Rate Hikes
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Wage growth has slowed recently, with average hourly earnings up 4.1% in October 2022 vs. a year ago.
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Slower wage growth suggests the Fed may not need to continue aggressive rate hikes as inflation cools.
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Even with slower wage growth, workers may be starting to see earnings catch up to inflation.
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The Fed says recession odds have faded as the labor market cools without a spike in layoffs.
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Experts say moderating wage growth indicates inflation pressures are easing, allowing the Fed to pause rate hikes.