WSJ: Powell End-of-Term Faces Delicate Balance on Employment and Prices

BlockBeats News, February 13th. The Wall Street Journal evaluated the US CPI report for January, pointing out that the year-on-year CPI increased by 2.4% in January, lower than the previous value and market expectations; excluding the volatile food and energy sectors, the core CPI rose by 2.5% year-on-year, in line with expectations. The Non-Farm Payrolls report released earlier this week showed that January's employment growth exceeded expectations, with the unemployment rate dropping to 4.3%.

Although the slowdown in inflation and robust employment are positive, Federal Reserve Chairman Powell faces a delicate balance in the last few months of his eight-year term: he must suppress inflation without harming the labor market.

Aggressive rate hikes had previously tamed the 2022 surge in prices, but as inflation recedes and the labor market cools, the Fed has cut rates by nearly 2 percentage points since the summer of 2024 and paused in January. With increasing signs of easing price pressures, economists widely expect further easing of inflation in 2026. (FXStreet)