The Federal Reserve meeting minutes showed that Fed staff expect overall inflation to decline for the remainder of the year, driven by lower retail gasoline prices, while core inflation is also expected to decline slightly. Inflation is projected to gradually decline over the next two years, reaching 2% in 2029, as the impacts of tariffs, geopolitical tensions, and AI development are expected to gradually diminish. Staff's inflation projections for 2026-2028 are slightly higher than those from the July meeting. GDP growth is expected to accelerate in the second half of this year and remain above potential growth until 2028, reflecting strong business investment, robust consumer spending, and supportive financial conditions. The unemployment rate is expected to remain below staff's long-term unemployment estimate until 2029. Staff's outlook for economic activity and the labor market is stronger than their projections from the July meeting.
