Esther George

anchored is going to be a point worth talking about.

Well, I think obviously a little bit different for the U.S.

to think about that and the Fed as it contemplates its updated dot plots.

But I do think it stays their hand on being able to suggest that they are looking to rate cuts.

but maybe in a pause mode.

I think this kind of environment will really remind them that inflation target has to be credible and they have to keep focused on that, even if their tools right now are in conflict.

They are looking at a job market that may be stable, but has shown signs of weakness while they have been looking at inflation that continues not only to be persistent, but as we've been talking about, is now going to show some upward pressure.

You know, I consider it stable in the sense when you step back and look at the unemployment rate, which is our best gauge, I think, of how that labor market looks.

It does mask what is underneath that surface, a lot of moving parts.

I think we're beginning to see the real impact of some of the immigration policy hits here.

We're beginning to see the uncertainty, I would argue, play out where businesses are happy to hire for positions they feel confident about, but they're not going to move hard and fast relative to the growth levels that we've seen.

So I think it's a tentative situation.

labor market, in my view, even though we continue to enjoy a relatively low unemployment rate.

Yes, I do, Jonathan.

And I think that's what makes this so challenging for the committee.

You can't ignore the story you just heard, which is there's something going on in the labor market.

Things are moving in a way.

And yet you can't really put your finger on.

Is this change happening in real time?

Is this going to settle out to a more stable view of what's going on with that labor market?