Follow the Stock Market in Real Time

Update 8:43 am: The Federal Reserve’s shift of focus to the labor market in 2020 will be reset on Friday when Fed Chair Jerome Powell is expected to unveil a new framework for the central bank that takes into account years when inflation rose, jobs were plentiful, and uncertainty became the order of the day. The new document may not completely discard the language used when the Fed, amidst the pandemic and a growing social justice movement, pledged not to disrupt labor market gains in the face of mere inflation threats, hoping to achieve ‘broad and inclusive’ employment levels. But Powell signaled that a recalibration is on the way, possibly emphasizing stable inflation as the basis for better labor market outcomes and relegating some ideas for times when the economy is unusually weak or inflation is unusually low, as was the case in the decade before the pandemic. During those years, when the Fed conducted a national listening tour, officials asked about inflation, ‘and people looked at us as if we had two heads. That wasn’t the issue’ when job and growth concerns were paramount, said Duke University professor Ellen Meade, who helped organize the 2020 framework review as a key Fed advisor. ‘The world looks very different now.’