Antonio and Dominique discuss the strong US jobs report, noting that while the economy remains at full employment, slowing wage growth suggests the labour market is not driving inflationary pressures. They look ahead to CPI and upcoming PCE revisions, arguing that the Cleveland Fed’s trimmed-mean and median CPI measures provide a better read on underlying inflation than standard core measures. While Governor Waller has made his support for a hold conditional on CPI, they see the bar as favouring a hold and expect the Fed to remain on hold this month.
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