March’s jobs report exceeded expectations, showing an addition of 303,000 jobs to US economy and in-line wage growth projections 4.1%. This strong economic data raises questions about the potential impact on future Federal Reserve interest rate cuts. Maconomics CEO and Personal Finance Expert Ross Mac joins Wealth! to provide his insights on the matter.
Mac notes that the relationship between wages and inflation is "very delicate." He explains that when wages increase, there can be an "unintended consequence" of companies raising prices, which in turn contributes to higher inflation. This dynamic, he suggests, may affect the probability of a near-term Fed rate cut.
Mac acknowledges that some Americans are feeling financially pressured under current economic conditions. He emphasizes the need to consider the "starting point," highlighting that prices are rising, and inflation is becoming increasingly sticky. This, he said, is forcing employers to raise their own prices, adding to the overall inflationary pressure.
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