A tight U.S. labor market is still adding to inflationary pressures, albeit to a lesser extent than in 2022 and 2023, according to research published Monday by the San Francisco Fed. "Declining demand for labor has depressed inflation by nearly 0.75 percentage points over the past two years," wrote San Francisco Fed economists Regis Barnichon and Adam Hale Shapiro. "However, high demand still contributed 0.3 to 0.4 percentage points to inflation through September 2024." The San Francisco Fed research suggests that the job market remains a source of inflation. Powell estimated inflation in October at 2.3 percent on the Fed's target measure and 2.8 percent on the food and energy-stripped measure the Fed uses to measure core inflationary pressures.