In this less dynamic and somewhat softer labor market, the downside risks to employment appear to have risen in recent months. Inflation has eased significantly from its highs in mid 2022, but remain somewhat elevated relative to our 2% longerrun goal. Estimates based on the consumer price index suggest that total PCE prices rose 2.8% 8% over the 12 months ending in September and that excluding the volatile food and energy categories, core PCE prices rose 2.8% as well.These readings are higher than earlier ...

Inflation Trends - Inflation has significantly eased from its 2022 highs but remains above the 2% long-term goal [1] - Total PCE prices rose 23% over the 12 months ending in May, while core PCE prices increased by 26% [1] - Near-term inflation expectations have risen in recent months, as indicated by market and survey-based measures [1] Inflation Expectations - Surveys indicate tariffs as a driving factor for inflation [2] - Most measures of longer-term inflation expectations remain consistent with the 2% goal [2] - The median projection for total PCE inflation this year is 3%, higher than the March projection [2] - The median inflation projection falls to 24% in 2026 and 21% in 2027 [2]