US Unemployment Rises, Fed Offers Room to Reduce Curiosity Charges

IN 2022, the US Central Bank The Fed raised interest rates to stop the wage spiral which was certainly not expected to occur amidst fairly tight employment at that time.

US Federal Reserve Governor Jerome Powell said rising unemployment would be a message for the Fed to lower interest rates. Unexpected weakness in the labor market will prompt the Fed to respond with policy.

Powell currently does not see any gaps in the labor market, despite rising unemployment in a number of states. Where the number of part-time workers began to decrease, followed by a reduction in working hours.

Powell is worried that if unemployment starts to rise, then for a short time, companies will announce layoffs which will encourage the wave of layoffs to move faster.

The Fed is increasingly confident in cutting interest rates, because as stated by Powell, the Fed is focused on two things, namely inflation and employment.

Currently, US inflation is starting to move down, while employment is also moving lower. Of course, these two things are what the Fed previously wanted.

The Fed must provide greater support for the economy, especially in financial markets. Policymakers also provide projections that the unemployment rate will be around 4% in the fourth quarter of 2024.

Currently 20 states have recorded sizable increases in unemployment, including New York, California, Arizona and Wisconsin.

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