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    Disney Is Bringing Employees Back Four Days a Week

    The C.E.O., Robert A. Iger, said in a memo that he thought the move would benefit the company’s culture and creativity.Starting on March 1, the Walt Disney Company will require employees to report to the office four days a week, a relatively strict policy among large companies.Robert A. Iger, who came out of retirement in November to retake Disney’s chief executive reins, said in a memo to employees on Monday that a return to mostly in-person work — for the first time in nearly three years — would benefit the company’s culture in general and movie and TV creative processes in particular. Since his return, Mr. Iger has been trying to boost morale and galvanize Disney’s creative engines.“As you’ve heard me say many times, creativity is the heart and soul of who we are and what we do at Disney,” Mr. Iger said in the memo, which was viewed by The New York Times. “And in a creative business like ours, nothing can replace the ability to connect, observe and create with peers that comes from being physically together.”The memo said that employees would likely be asked to work from Disney offices Monday through Thursday. “Stay tuned for additional details,” Mr. Iger said.The shift did not come as a complete surprise to Disney employees; Mr. Iger signaled that a change was coming during a Nov. 28 meeting with them. CNBC earlier reported on his memo on Monday.Disney has required most employees to report to the office three days a week for roughly the last year, in line with most major media companies. NBCUniversal has a three-days-a-week policy (Tuesday, Wednesday and Thursday), while Warner Bros. Discovery requires three days between Monday and Thursday.Mr. Iger’s return-to-work edict was accompanied by praise for a wide array of Disney divisions, including Broadway productions and Imagineering, the company’s theme park design unit. Bob Chapek, who was chief executive from 2020 until he was fired in November, sometimes left certain groups in the company feeling overlooked or underappreciated.“I would be remiss not to mention how the ESPN team expertly handled Damar Hamlin’s tragic injury, showing grace under pressure, and presenting the facts to viewers with utter respect and sensitivity,” Mr. Iger said in the memo, referring to the Buffalo Bills player who collapsed and went into cardiac arrest on “Monday Night Football” on Jan. 2.Mr. Iger is also working on a sweeping restructuring involving the flow of content to Disney’s streaming services. He has also signaled that cost cutting lies ahead, including potential layoffs. More

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    Consumers see inflation—and spending—cooling off in the year ahead, New York Fed survey shows

    The one-year inflation outlook declined to 5%, the lowest level since July 2021, according to a New York Fed survey released Monday.
    Household spending expectations tumbled a full percentage point to 5.9%, the lowest level since January 2022.
    Consumers expect gas prices to increase 4.1% and food prices to rise 7.6% over the next year, in both cases a 0.7 percentage point decline from the previous month

    People shop for goods at a Publix in Nashville, Tennessee, on December 22, 2022, ahead of winter storm Elliot. 
    Seth Herald | AFP | Getty Images

    Consumers see the inflation burden easing while they expect to pull back considerably on their spending, according to a closely watched survey the New York Federal Reserve released Monday.
    The central bank district’s monthly Survey of Consumer Expectations for December showed that the one-year inflation outlook declined to 5%, down 0.2 percentage point from the previous month and the lowest level since July 2021.

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    While that pace would still be well above the Fed’s goal of 2% annual inflation, it represents progress in the fight against the surging cost of living. Economists believe that expectations are a key to inflation, as they influence the behavior of companies that will raise prices and workers who will demand higher wages if they think prices are going to keep rising.
    The New York Fed’s one-year expectations gauge had hit a record 6.8% in June, according to data going back to 2013, amid a surge in inflation to its highest point in more than 40 years
    Over the longer term, expectations were little changed, with the three-year outlook holding at 3% and the five-year projection edging higher to 2.4%.
    Consumers expect gas prices to increase 4.1% and food prices to rise 7.6% over the next year, but both figures represent 0.7 percentage point declines from the previous month.
    Though they see prices continuing to rise, consumers figure to be spending less.

    The one-year outlook for household spending tumbled a full percentage point to 5.9%, the lowest level since January 2022 and well below the record-high 9% hit in May 2022. At the same time, household income is expected to rise 4.6% over the next year, a series high.
    The results come amid the Fed’s move to use interest rate rises to tamp down inflation. In 2022, the central bank hiked benchmark rates by 4.25 percentage points and is expected to add a few more increases in the early part of this year before pausing.
    One primary target is the still-hot labor market, which saw growth of 223,000 nonfarm payroll jobs in December. Fed officials worry that a continued imbalance of labor demand for supply — 1.7 open jobs for every available worker — will continue to push wages and business costs higher.
    Despite the efforts, survey respondents grew more optimistic about the labor market, with 40.8% expecting the unemployment rate to be higher a year from now, a 1.4 percentage point decline from November. Unemployment was at 3.5% in December, tied for the lowest level since late 1969.
    Home prices also are expected to grow 1.3%, a 0.3 percentage point increase from November, according to the survey.

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    Britain’s Economic Health Is Withering With Sick Workers on the Sidelines

    Many people who want to work can’t because of long-term health problems, a persistent issue that is causing Britain’s economy to go “into reverse.”Christina Barratt was used to the 12- to 14-hour days. For years, she would get into her car each morning and set out to department stores and other retailers all over northwest England, selling greeting cards for a large manufacturer.“It’s a very demanding, busy job,” she said, recalling how she had to make sales, manage client accounts and grow the business, while often traveling long distances.In March 2020, at the age of 50, Ms. Barratt got Covid. She hasn’t been able to work since.Ms. Barratt is among 3.5 million people — or about one in 12 working-age adults in Britain — who have long-term health conditions and are not working or looking for work. The number ballooned during the first two years of the pandemic when more than half a million more people reported they were long-term sick, with physical and mental health conditions, according to analysis by economists at the Bank of England. The sharp rise in ill health is a startling problem itself, but there has also been a growing awareness in Britain about the negative effects on the economy of having so many people unable to work.Sickness is adding to the growing sense of malaise in a country troubled by high inflation and the economic costs of Brexit, where the National Health Service is overwhelmed and workers across industries are striking in ever larger numbers, coming after a year of severe political upheaval.With the unemployment rate near its lowest point in half a century, businesses have loudly complained that they have been unable to hire enough workers, leaving the government grappling with how to expand the labor market. Before the pandemic, a growing labor market had been “the single cylinder of growth in the economic engine,” Andy Haldane, the former chief economist of the Bank of England, said in November during a lecture at the Health Foundation, a nonprofit organization. It “has now gone into reverse gear.”Britain is in “a situation where for the first time, probably since the Industrial Revolution, where health and well-being are in retreat” and acting as a brake on economic growth, said Mr. Haldane, who currently serves as the chief executive of the Royal Society of Arts, an organization in London that seeks practical solutions to social issues.The economy is probably already in a recession, according to forecasts by the Bank of England and others, and is expected to return to only meager growth in 2024. Some economists have warned that shortages of workers could deepen the cost-of-living crisis if it causes employers to raise wages to attract workers in a way that threatens to entrench high inflation into the economy. That could prompt the central bank to keep interest rates high, pushing up borrowing costs and restraining the economy.At the heart of the problem is a high economic inactivity rate that has barely budged despite the end of pandemic lockdowns, a boom in labor demand and a high cost of living. As of October, over half a million more people were counted as inactive than before the pandemic, according to the Office for National Statistics. In a separate study looking at data for the first two years of the pandemic, Jonathan Haskel and Josh Martin, economists at the Bank of England, found that nearly 90 percent of the increase in economic inactivity could be attributed to people who were long-term sick.The extent to which sickness is forcing people to leave the work force is still being debated among researchers in Britain because the reasons for not working can change over time. But there is little disagreement that the economy is being held back by having so many people who say ill health has kept them from working.A sign outside a pub in Hampshire, Britain, that takes a creative tack in advertising for workers.Chine Nouvelle, via ShutterstockBusinesses have loudly complained that they have been unable to hire enough employees.Paul Ellis/Agence France-Presse — Getty ImagesContributing to the rise in sickness are not only tens of thousands of cases of long Covid, which Ms. Barratt is suffering from, but also a vast backlog of people — about seven million — with a variety of health problems who are on waiting lists for N.H.S. care. The latest numbers add to a longer-term trend. In the 25 years before the pandemic, the tally of people reporting long-term sickness grew about half a percent a year. Since then, it accelerated to 4 percent a year, according to the study by Mr. Haskel and Mr. Martin.Britain’s aging population means there are more sick people, but “the prevalence of poor health has been growing” as well, said David Finch of the Health Foundation, which has studied links between illness and economic inactivity. In the past few years, the foundation found, there has been a large increase in the number of people with cardiovascular problems, mental illness, and a range of other ailments, which would include respiratory conditions and long Covid symptoms.Britain is one of just seven countries in the Organization for Economic Cooperation and Development that still has a higher rate of economic inactivity than it did before the pandemic, the Office for National Statistics reported. The United States is also in this group, but its missing workers are mostly explained by retirement and a decline in participation by middle-aged men without college degrees, rather than sickness. The increase in the rate of economic inactivity in Britain is more than twice as large as the increase in the United States. These missing workers face a number of barriers in returning to work. For some, the severity of their health condition prevents them from working, while others are unable to return to the job they used to do. . Ms. Barratt, the greeting card saleswoman, has no illusions about going back to a similar job.“There’s no way I could do that kind of role any more,” Ms. Barratt said. “I’m just not well enough to sustain any kind of level of energy.” Just getting up and down the stairs at home is a challenge, she said.She is feeling the strain of living on government benefits for more than two years and would like to return to work. “If I continue to have this condition, which can go up and down in severity, I’d have to find some kind of employment that was very flexible,” she added.Although there has been a worrying increase in the number of economically inactive people — sick or not — who don’t want to work, there are still 1.7 million who do but are unable to look for a job and start work soon, according to the Office for National Statistics.Kirsty Stanley said the transition back to work for people with long Covid can be difficult. “They basically expect people to go from potentially zero to 100” within four to six weeks, she said.Nicholas White for The New York Times“This has been a long-term issue in keeping people with disabilities in the workplace,” said Kirsty Stanley, an occupational therapist. There are a lot of challenges, including some employers not understanding legal requirements to make reasonable accommodations for employees with health problems, Ms. Stanley said. She is an associate for Long Covid Work, a group that works with unions and employment groups to improve access to work for people with long Covid. Mr. Haskel and Mr. Martin estimate that there are 96,000 people who are economically inactive because of long Covid.Ms. Stanley, who also suffers from long Covid, said one problem was that the gradual period for returning to work that employers offer to people after a long absence doesn’t work well for those with long Covid.“They basically expect people to go from potentially zero to 100” within four to six weeks, she said. “What happens is people crash.”A little over two years ago, Michael Borlase did a four-week phased return to work after being sick with Covid. But at the end of the period, after getting back to an eight-hour shift, he got sick again and could not go back to work.He was a newly qualified nurse working in a psychiatric ward for men with mental health issues who have committed a crime. He was there for just eight months before he got Covid in April 2020.Michael Borlase used to be a nurse in a psychiatric ward. Now he’s not sure he could go back to that work. Nicholas White for The New York Times“I’d been so poor for so long as a student nurse,” he said. “I was thrilled to be working, work for the N.H.S. and felt very proud of the work I was doing. And then Covid hit.”“I was very early on in my career,” he added. “And now I don’t know if I can ever go back again.”At age 36, he said he felt “stuck in a professional limbo,” where he could not do the job he spent years training for but was too unwell to train for something else. Until September, Mr. Borlase received full pay because of a provision for N.H.S. workers with Covid. Since then, Mr. Borlase has been receiving reduced wages from sick pay, which will expire in April.Delays in getting health treatment have made it difficult for Andrea Slivkova, 43, to return to work. A Czech native who came to Britain 10 years ago, she left her job cleaning offices in mid-2021 because of pain from a prolapsed pelvic organ. It was more than a year before she could have the surgery to address the problem. Since then, she said, she is still unwell but has not been able to have a follow-up appointment with a specialist. Last summer, she was told it would be a five-month wait.“They told me that the waiting list is long because other people are waiting, too,” Ms. Slivkova said, with her daughter, Kristyna Dudyova, translating from Czech.Ms. Slivkova still hasn’t returned to work. She described the strain of having a physical health condition but also the struggle to navigate the health care system and the financial stress of relying on government benefits.Ms. Dudyova recalled how her mother used to be a workaholic, who found time to bake, go to the gym, work multiple jobs if necessary, all while raising her and her younger brother.“But now everything is just gone,” she said. More

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    Speaker Drama Raises New Fears on Debt Limit

    An emboldened conservative flank and concessions made to win votes could lead to a protracted standoff on critical fiscal issues, risking economic pain.WASHINGTON — Representative Kevin McCarthy of California finally secured the House speakership in a dramatic middle-of-the-night vote early Saturday, but the deal he struck to win over holdout Republicans also raised the risks of persistent political gridlock that could destabilize the American financial system.Economists, Wall Street analysts and political observers are warning that the concessions he made to fiscal conservatives could make it very difficult for Mr. McCarthy to muster the votes to raise the debt limit. That could prevent Congress from doing the basic tasks of keeping the government open, paying the country’s bills and avoiding default on America’s trillions of dollars in debt.The speakership battle suggests President Biden and Congress could be on track later this year for the most perilous debt-limit debate since 2011, when former President Barack Obama and a new Republican majority in the House nearly defaulted on the nation’s debt before cutting an 11th-hour deal.“If everything we’re seeing is a symptom of a totally splintered House Republican conference that is going to be unable to come together with 218 votes on virtually any issue, it tells you that the odds of getting to the 11th hour or the last minute or whatever are very high,” Alec Phillips, the chief political economist for Goldman Sachs Research, said in an interview Friday.Representative Kevin McCarthy won the speakership early Saturday only after making a deal with hard-right lawmakers.Kenny Holston/The New York TimesThe federal government spends far more money each year than it receives in revenues, producing a budget deficit that is projected to average in excess of $1 trillion a year for the next decade. Those deficits will add to a national debt that topped $31 trillion last year.Federal law puts a limit on how much the government can borrow. But it does not require the government to balance its budget. That means lawmakers must periodically pass laws to raise the borrowing limit to avoid a situation in which the government is unable to pay all of its bills, jeopardizing payments including military salaries, Social Security benefits and debts to holders of government bonds. Goldman Sachs researchers estimate Congress will likely need to raise the debt limit sometime around August to stave off such a scenario.Understand the U.S. Debt CeilingCard 1 of 4What is the debt ceiling? More

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    Fed Officials Ask How to Better Understand Inflation After Surprises

    Federal Reserve officials, including Lisa Cook, a board member, are wrestling with how to think about price increases after 18 months of rapid change.NEW ORLEANS — Federal Reserve officials kicked off 2023 by addressing a thorny question that is poised to bedevil the central bank throughout the year: How should central bankers understand inflation after 18 months of repeatedly misjudging it?Lisa D. Cook, one of the Fed’s seven Washington-based governors, used a speech at the American Economic Association’s annual gathering in New Orleans to talk about how officials could do a better job of predicting price increases in the future. Her voice was part of a growing chorus at the conference, where economists spent time soul-searching about why they misjudged inflation and how they could do a better job next time.Fed officials must “continue to advance our understanding of inflation” and “our ability to forecast risks,” Ms. Cook said during her remarks, suggesting that central bankers could update their models to better incorporate unexpected shocks and to better predict moments at which inflation might take off.Her comments underscored the challenge confronting monetary policymakers this year. Officials have rapidly raised rates to try to cool the economy and bring inflation back under control, and they must now determine not only when to stop those moves but also how long they should hold borrowing costs high enough to substantially restrict economic activity.Those judgments will be difficult to make. Although inflation is now slowing, it is hard to know how quickly and how fully it will fade. The Fed wants to avoid retreating too soon, but keeping rates too high for too long would come at a cost — harming the economy and labor market more than is necessary. Adding to the challenge: Policymakers are making those decisions at a moment when they still don’t know what the economy will look like after the pandemic and are using data that is being skewed by its lasting effects.“The pandemic has triggered a lot of changes in terms of how our economy operates,” Raphael Bostic, the president of the Federal Reserve Bank of Atlanta, said during a panel on Friday. “We’re very much in flux, and it’s hard to know for sure how things are going to evolve on a week-to-week or month-to-month basis.”Understanding inflation is key to the thorny policy questions facing the Fed. But determining what causes and what perpetuates price increases is a complicated economic question, as recent experience has demonstrated.Officials have raised rates rapidly to try to slow the economy and bring inflation back under control.Jim Wilson/The New York TimesFed officials and economists more broadly have had a dismal track record of predicting inflation since the onset of the pandemic. In 2021, as prices first began to take off, officials predicted that they would be “transitory.” When they lasted longer than expected, both policymakers and many forecasters on Wall Street and in academia spent 2022 predicting that they would begin to fade faster than they actually did.Given those mistakes, policymakers have begun to suggest that the central bank needs to reassess how it looks at inflation.Inflation F.A.Q.Card 1 of 5What is inflation? More

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    US Added 223,000 Jobs in December, a Slight Easing in Pace

    The Federal Reserve’s moves to cool the economy with higher interest rates seem to be taking gentle hold. Wage growth lost momentum.The U.S. economy produced jobs at a slower but still comfortable rate at the end of 2022, as higher interest rates and changing consumer habits downshifted the labor market without bringing it to a halt.Employers added 223,000 jobs in December on a seasonally adjusted basis, the Labor Department reported on Friday, in line with economists’ expectations although the smallest gain since President Biden took office.The gradual cooling indicates that the economy may be coming back into balance after years of pandemic-era disruptions — so far with limited pain for workers. The unemployment rate ticked down to 3.5 percent, back to its level from early 2020, which matched a low last seen in 1969.“If the U.S. economy is slipping into recession, nobody told the labor market,” said Chris Varvares, co-head of U.S. economics for S&P Global Market Intelligence, noting that the December number is still nearly double the approximately 100,000 jobs needed to keep up with population growth.Monthly change in jobs More

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    U.S. unemployment rate falls in December, but rises for Black women, Hispanic men

    Commuters arrive into the Oculus station and mall in Manhattan on November 17, 2022 in New York City.
    Spencer Platt | Getty Images

    The U.S. unemployment rate declined overall in December, but rose for Black women and Hispanic men, according to the latest nonfarm payrolls report.
    Black women saw unemployment increased to 5.5% last month, up 0.3 percentage points from 5.2% in November, data from the Labor Department showed Friday. Overall, Black employment held steady at 5.7%, while the unemployment rate for Black men actually declined to 5.1% from 5.4% last month.

    Meanwhile, Latino men saw unemployment rise to 4% in December, an increase of 0.4 percentage points from 3.6% the prior month. The overall unemployment rate ticked up to 4.1% from 4.0%. Unemployment among Latino women also ticked up to 3.7% from 3.6%.
    Those figures bucked the trend in the broader economy, which showed unemployment in the U.S. fall to 3.5% from 3.7%. It was 0.2 percentage points below consensus expectations from the Dow Jones.

    “What we’ve really seen over the course of the last nearly three years since the pandemic hit, is that we’ve regained, in terms of aggregate numbers, all of the jobs lost,” said Michelle Holder, a distinguished senior fellow at Washington Center for Equitable Growth.
    “But the sort of industrial mix has changed, and has kind of impacted what we’re seeing with regard to the distribution of joblessness, by gender, race and ethnicity. And it’s really disaffecting Black women and Latinx men,” Holder added.
    A stronger-than-expected December jobs report continued to suggest a robust labor market, even as lighter-than-expected wage growth fanned some investor hopes that inflation may be coming down.

    Nonfarm payrolls rose by 223,000 in December, more than the Dow Jones estimate of 200,000. Meanwhile, average hourly earnings rose 0.3% for the month and gained 4.6% from a year ago. These are compared to estimates of 0.4% and 5% increases.
    “The labor market clearly remains strong,” said Elise Gould, a senior economist at the Economic Policy Institute. “We are now seeing that the household survey and the payroll survey are showing similar signs of strength, and wage growth is looks to be coming down.”

    Still, parts of the economy where Black women are overrepresented showed little improvement, or failed to regain their levels from before the pandemic, according to Holder. Government employment was little changed, adding just 3,000 jobs in December. Notably, state government education employment dropped by 24,000 because of strikes from university employees, according to the Labor Department.
    Both Black women and Latino men are well represented in the leisure and hospitality sector, according to Holder. The sector significantly added jobs in December, but remains below its pre-pandemic levels. Employment in the sector rose by 67,000 last month, but is still 932,000, or 5.5%, below what it was in February 2020.
    “Those are two industries that have not recovered well during the pandemic,” Holder said. “This is what is constraining Black women’s ability to get back to the state that they were with regard to the American workforce before the pandemic.”

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    Nonfarm payrolls rose 223,000 in December, as strong jobs market tops expectations

    Nonfarm payrolls increased by 223,000 for the month, above the Dow Jones estimate for 200,000.
    The unemployment rate fell to 3.5%, a decline of 0.2 percentage point and also better than the estimate.
    Wage growth was below expectations, with average hourly earnings up 4.6% from a year ago, below the 5% estimate.
    Leisure and hospitality led job gains, followed by health care, construction and social assistance.

    Payroll growth decelerated in December but was still better than expected, a sign that the labor market remains strong even as the Federal Reserve tries to slow economic growth.
    Nonfarm payrolls increased by 223,000 for the month, above the Dow Jones estimate for 200,000, while the unemployment rate fell to 3.5%, 0.2 percentage point below the expectation. The job growth marked a small decrease from the 256,000 gain in November, which was revised down 7,000 from the initial estimate.

    Wage growth was less than expected in an indication that inflation pressures could be weakening. Average hourly earnings rose 0.3% for the month and increased 4.6% from a year ago. The respective estimates were for growth of 0.4% and 5%.
    By sector, leisure and hospitality led with 67,000 added jobs, followed by health care (55,000), construction (28,000) and social assistance (20,000).
    Stock market futures rallied following the release as investors look for signs that the jobs picture is cooling and taking inflation lower as well.
    “From the market’s perspective, the main thing they’re responding to is the softer average hourly earnings number,” said Drew Matus, chief market strategist at MetLife Investment Management. “People are turning this into a one-trick pony, and that one trick is whether this is inflationary or not inflationary. The unemployment rate doesn’t matter much if average hourly earnings continue to soften.”
    The relative strength in job growth comes despite repeated efforts by the Fed to slow the economy, the labor market in particular. The central bank raised its benchmark interest rate seven times in 2022 for a total of 4.25 percentage points, with more increases likely on the way.

    Primarily, the Fed is looking to bridge a gap between demand and supply. As of November, there were about 1.7 job openings for every available worker, an imbalance that has held steady despite the Fed’s rate hikes. The strong demand has pushed wages higher, though they mostly haven’t kept up with inflation.
    December’s wage data, though, could provide some encouragement that the Fed’s efforts are impacting demand.
    “There’s some indication that things are moving in the right direction. We’re seeing the impact of the blunt tools of monetary policy take effect,” said Mike Loewengart, head of model portfolio construction for Morgan Stanley’s Global Investment Office. “I don’t think this is going to sway the Fed from a few additional raises going forward, but it no doubt is encouraging to see a moderation in wages.”

    The drop in the unemployment rate came as the labor force participation rate edged higher to 62.3%, still a full percentage point below where it was in February 2020, the month before the Covid-19 pandemic hit.
    A more encompassing measure of unemployment that takes into account discouraged workers and those holding part-time jobs for economic reasons also declined, falling to 6.5%, its lowest-ever reading in a data set that goes back to 1994. The headline unemployment rate is tied for the lowest since 1969.
    The household count of employment, used to calculate the unemployment rate, showed a huge gain for the month, rising 717,000. Economists have been watching the household survey, which has generally been lagging the establishment count.
    The U.S. heads into 2023 with most economists expecting at least a shallow recession, the result of Fed policy tightening aimed at tamping down inflation still running near its highest level since the early 1980s. However, the economy closed 2022 on a strong note, with GDP growth tracking at a 3.8% rate, according to the Atlanta Fed.
    Fed officials at their last meeting noted that they are encouraged by the latest inflation readings but will need to see continued progress before they are convinced that inflation is coming down and they can ease up on rate hikes.
    As things stand, markets are largely expecting the Fed to increase rates another quarter-percentage point at its next meeting, which concludes Feb. 1.

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