The Federal Reserve may not be happy until it gets unemployment all the way down to 5.5%, if statements from central bank officials and other economists are an indication.
Up until recently, the U.S. central bank appeared steadfast on a benchmark of 6.5% before it began normalizing its target for short-term interest rates from the near-zero current level. The zero-bound has been in place since the darkest days of the financial crisis that exploded in 2008.
That commitment to concrete targets for policy change has changed recently, however. The unemployment rate has been on a steady downward trajectory, though the October reading showed a slight uptick to 7.3%. But it has been doing so in great part due to the shrinking labor force.
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