United States Federal Reserve Chair Jerome Powell stated that the Fed’s ultimate goal is headline inflation. He added that although the central bank is “of course looking very carefully at the core inflation, as it is a much better predictor of where inflation is going,” the current situation is very difficult as the Fed needs to be “mindful of the potential effect on inflation expectations from headline.”

Powell underscored that the Fed cannot do much about “the difference between the elements that make up the headline that are not in the core” at present. He asserted that the US economy is in a “strong position to deal with higher interest rates” and that the areas the central bank can affect are “those associated with excess demand.” This effect will be seen through “job openings in real-time.”