headaches for the Fed are caused by wages, employment and inflation

The job market is doing what it takes to make a living: The U.S. employers add more jobs in January, February and March

They have jobs. Klachkin says their wages are increasing. “It’s not to say that there’s not risks. Credit card delinquencies are up. The savings rate is quite low. If and when the labor market weakens, they are exposed. The consumer is going to be spending as usual until that happens.

Powell said that high interest rates have not hurt the job market, so they can be patient in battling inflation. U.S. employers added an average of 276,000 jobs a month in January, February and March — up from 212,000 jobs on average in the three previous months. The April jobs numbers will be released on Friday.

According to figures released Monday by the Labor Department, employers’ cost of labor increased in the 12 months ending in March. People keep spending their money, even if rising wages put more upward pressure on prices.

How Interest Rate Sensitive are Plastic Surgery and Cargo Purchases: The Challenge of Changing Mortgage Rates for Consumers with Higher Interest Rates

Most Americans don’t carry credit card debt and are insulated from the Fed’s rate hikes because of their low, fixed-rate mortgages.

“We have one tool, basically, and it’s interest rates,” Goolsbee said. “If you ask the question, ‘How interest rate-sensitive are elective plastic surgeries?’ I have no idea. So we’re trying to match our tools to the moment and that’s not totally straightforward.”

So while the Fed can influence demand for cars and houses by adjusting interest rates, its ability to tamp down demand for restaurant meals or concert tickets is more limited.

“You typically take out a loan for when you make a big goods purchase, like a car, certainly a house,” says Ernie Tedeschi, director of economics at the Yale Budget Lab. “Services spending is generally less interest rate-sensitive.”

The Fed Rate-Setting Committee Reports Implications for the First Half of the Last Three-Year Low-Energy Quarter

Economic growth is slowing. But hiring appears to be picking up. The cost of cars is going down but auto insurance is going up. The inflation was lower last month than it was a year ago.

“Inflation has eased over the past year but remains elevated,” the Fed’s rate-setting committee said in a statement. There has been no further progress on the Committee’s 2% inflation objective in recent months.

Last week, the Commerce Department put out inflation numbers showing a 2.7% increase in prices for the year ending in March. Former White House economist Ernie Tedeschi says he’s not worried that inflation is picking up steam, but he agrees with Goolsbee that it’s no longer cooling.

Inflation fell sharply in the second half of last year, leading some to believe the Fed would soon be ready to take its foot off the brake and start cutting interest rates. The Fed is expected to keep its interest rate at a record-high through the summer as progress on prices has slowed, according to Fed watchers.

Is There a Kennel of Data Dogs? Confusing Fed Policymakers with Inflationary Statistics and the Decline of the U.S. Dollar

Should you join the kennel of data dogs? Chicago Fed president Austan Goolsbee said recently. Stop walking and start sniffing if you are unclear. With these numbers, we need to do more sniffing.

As they try to sift through sometimes contradictory economic signals, Fed policymakers are likely to stick with their go-slow approach, leaving interest rates unchanged this week — and possibly for months to come.

The Federal Reserve has promised to be “data driven” in deciding when to cut interest rates. But some of the recent economic data has the central bank driving in circles.

The Commerce Department’s inflation yardstick shows that consumer prices were higher in March than they were a year ago.