What the U.S. Jobs Report Means for Fed Policy

The video discusses the Federal Reserve's shift in focus towards employment over inflation, highlighting the impact of this change on market reactions and interest rate expectations. It explores the Fed's strategy of allowing the labor market to run hot and the associated risks of inflation. The market's interpretation of the Fed's actions, particularly regarding the yield curve and potential policy errors, is also analyzed.

How has the labor market been described in relation to the Fed's strategy?

What does the market's reaction to the Fed's policies suggest about inflation expectations?