Turning to inflation, given the volatility and idiosyncrasies of the data, I view the current reading on core PCE (personal consumption expenditures) inflation, at 1.8 percent, as being roughly consistent with our 2 percent objective. Overall, inflation pressures are muted.
But I do not believe that the seeming unresponsiveness of inflation to the apparent tightness of the labor market and other aspects of the economy tells the whole story in evaluating slack versus constraint in the economy.