By: The Editorial Board - wsj.com - October 29, 2025

Yet inflation remains above the Fed’s official 2% target even excluding tariffs. When the Fed chief says inflation would be 2.3%-2.4% without tariffs rather than 2.8% (according to the Fed’s core personal-consumption-expenditure measure), Mr. Powell is admitting that he isn’t hitting his target even without tariffs.

The cross-cutting data on the Fed’s two mandates—price stability and full employment—argues for caution from policy makers. Mr. Powell claims that’s what he’s delivering by warning investors off any hopes for another rate cut in December. “What do you do if you’re driving in a fog?” he asked during his press conference. “You slow down.”