Weak Jobs & Inflation Jitters | Bloomberg Surveillance

The morning centered on a much weaker-than-expected February jobs report, with the economy losing 92,000 jobs, unemployment rising to 4.4%, and payroll revisions adding to the sense that the labor market has stalled. The guests argued that the data do not necessarily mean recession, but they do reinforce a long-running picture of a “jobless expansion,” where GDP can still grow even as hiring barely does. One economist said the labor market is being shaped by both softer demand and a shrinking labor supply from immigration changes, while also warning that AI could reshape job creation in either direction depending on how leaders manage it.

The discussion then shifted to the market reaction and the bigger inflation backdrop. An investment chief argued that geopolitical risk, especially disruption in the Strait of Hormuz, is being underestimated by markets and could lift oil, global supply costs, and U.S. inflation for longer than investors expect. Another strategist said the right way to think about the selloff is the distinction between “front page risk” and “bottom line risk”: markets may ignore headlines until they start to hit earnings. The panel also said rate-cut odds look more difficult after the jobs data and stronger wage readings, even as some argued the Fed would still defend the labor market if needed.

A Washington strategist added that the Iran conflict is politically risky for the president if it drags on or broadens, especially with gasoline prices rising. He said Congress and the 2026 election cycle are already becoming central, but that Republicans still look favored to hold the Senate based on the seats up this year.