Weaker labor data has boosted expectations of Fed rate cuts, with Wharton’s Jeremy Siegel predicting three reductions this year. Markets are rallying on the outlook, while Goldman Sachs’ Jan Hatzius warns job growth is fragile but sees a rebound by 2026 as tariffs ease and policy turns supportive.

Recent jobs data did not paint the stable picture of the labor market that the Federal Open Market Committee (FOMC) might have been hoping for. The story will likely be the same for inflation data released later this week.

While conflicting pressures on both sides of the Fed’s dual mandate will make a base rate decision more complex for chairman Jerome Powell and his colleagues, markets are taking it as a win: The Fed may, at last, be forced to cut the base interest rate.

This is what many

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