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The discussion highlights the recent employment data indicating that the Federal Reserve is expected to raise its policy rate by 25 basis points in May. The unemployment rate remains low at 3.5%, reflecting a strong but cooling job market, which is considered stable but not definitive enough for the Fed to announce a peak. Wages are up 4.2% year-over-year, with a slight recent increase. There is optimism about a near-term peak in policy rates due to diminishing wage price pressures. However, labor demand remains strong across various service industries, resulting in a tight labor market despite inflation concerns.