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

On February 13, The Wall Street Journal analyzed the U.S. January CPI report, noting that year-over-year CPI rose 2.4% last month—below the prior reading and market expectations—while core CPI (excluding volatile food and energy) climbed 2.5% year-over-year, matching forecasts. Earlier this week, the Non-Farm Payrolls report showed January’s job growth exceeded expectations, pushing the unemployment rate down to 4.3%. While slower inflation and strong employment are positive signs, Federal Reserve Chair Jerome Powell faces a delicate balance in the final months of his eight-year term: taming inflation without harming the labor market. Aggressive rate hikes previously curbed the 2022 price surge, but as inflation eases and the labor market cools, the Fed has cut rates by nearly 2 percentage points since summer 2024 and paused its easing cycle in January. With growing signs of easing price pressures, economists widely expect further inflation moderation in 2026. (Source: FXStreet)