Saad Ullah
Labor market weakness is becoming harder to ignore, and traders are starting to price in what that could mean for monetary policy next year. One macro-focused post draws a direct connection between plummeting job openings and the growing likelihood of rate cuts expected in 2026, arguing that deteriorating employment data leaves the Federal Reserve with fewer options.
Job Openings Collapse to 0.87 Per Unemployed Worker
U.S. job openings have dropped to what the analyst describes as "extremely low" territory. The chart included in the post shows the job openings-per-unemployed-worker ratio sitting around 0.87, down sharply from a cycle peak near 2.01. That decline signals weakening labor demand, and when combined with a rising unemployment rate, it strengthens the case that the Fed may be forced into aggressive policy easing.
This isn't just theory—historically, falling openings per worker have preceded major shifts in monetary policy. The post connects that pattern to current Fed rate cut odds, which have been climbing as employment indicators cool. If the Fed pivots and cuts hard, markets typically respond by repricing risk assets across the board.
Political Context: Fed Leadership and Fiscal Spending
The analyst also flags political developments that could reinforce the easing narrative. President Donald Trump reportedly told Fox Business that a new Fed chair would be appointed—someone willing to cut rates. The post also mentions expectations for military spending to increase by over $600 billion, adding another layer of potential fiscal stimulus to an already shifting macro backdrop.
Whether these political promises come to fruition or not, market expectations matter. Traders don't wait for confirmation—they position based on probabilities. As employment data weakens and rate cut expectations rise, the policy shift narrative gains momentum, influencing how investors allocate across asset classes and adjust their exposure to monetary conditions heading into next year.
Saad Ullah
