Powell: Inflation for goods picked up, reflecting effects of tariffs

Economic Outlook - The economy is expanding at a moderate pace, with solid consumer spending and business fixed investment [3] - The temporary government shutdown likely weighed on economic activity in the current quarter, but these effects should be mostly offset by higher growth next quarter [4] - Real GDP is projected to rise 17% this year and 23% next year, somewhat stronger than projected in September [4] Labor Market - Labor market conditions appear to be gradually cooling [1] - Layoffs and hiring remain low, and perceptions of job availability and hiring difficulty have declined [5] - The unemployment rate reached 44% in September, and job gains have slowed significantly [5] - The median projection of the unemployment rate is 45% at the end of this year and edges down thereafter [6] Inflation - Inflation has eased significantly from its highs in mid-2022, but remains somewhat elevated relative to the 2% longerrun goal [7] - Total PCE prices rose 28% over the 12 months ending in September, and core PCE prices also rose 28% [7] - Near-term measures of inflation expectations have declined from their peaks earlier in the year [8] - The median projection for total PCE inflation is 29% this year and 24% next year, a bit lower than the median projection in September, thereafter, the median falls to 2% [9] Monetary Policy - The Federal Open Market Committee decided to lower the policy interest rate by a quarter percentage point (025%) [2] - The Committee also decided to initiate purchases of shorterterm Treasury securities solely for the purpose of maintaining an ample supply of reserves [2]