- Financial conditions have tightened significantly since June
- For core services ex-housing sector, inflation remains elevated; prospects for it slowing may depend in part on an easing of tight labor market conditions
- Market liquidity remained low in Treasury and other key markets
- Bringing inflation back to 2% likely requires period of below-trend growth, some softening of labor market conditions
- Underlying momentum in the economy likely remains subdued
- Core foreign inflation remains high and inflation pressures are broad
- Will adjust balance sheet drawdown process if there is a need to
- Tight labor market conditions have largely erased pandemic-induced widening of employment caps across demographic groups
- Rate hikes have narrowed gap between policy rule settings and real-world level
- Labor force participation rate is likely to remain well-below its level from before the pandemic
I don't think the Fed is trying to send any signals with this report but it's a nice review of what the Fed is worried about.