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Fed's Powell points to persistent labor market weakness as government shutdown delays official reports

1. Fed Chair Powell cites softening labor market conditions. 2. Declining payroll gains and lower immigration impact employment growth. 3. Evidence suggests low layoffs but also low hiring activity. 4. Job availability perceptions are worsening for households and firms. 5. Inflationary pressures persist, complicating economic outlook.

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FAQ

Why Bearish?

A soft labor market indicates potential economic slowdown, reminiscent of post-2008 trends.

How important is it?

Current labor market conditions may lead to reduced corporate earnings, impacting S&P 500 valuations.

Why Short Term?

Immediate market reactions are likely as companies adjust to decreased hiring forecasts.

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