Fed’s Paulson Sees More Risks to Labor Market Than Inflation

Federal Reserve Bank of Philadelphia President Anna Paulson said Friday she expects inflation to cool next year though she cautioned there is a risk of a further downturn in the labor market.

“On net, I am still a little more concerned about labor market weakness than about upside risks to inflation,” Paulson said Friday at the Delaware State Chamber of Commerce. “That’s partly because I see a decent chance that inflation will come down as we go through next year.” The impact of tariffs on goods prices should fade by the middle of next year, she said.

Describing the labor ...