The lingering effects of the Covid-19 pandemic are still shaping the global economy, particularly in the labor market. Despite the worst of the health crisis having passed, one of its enduring legacies is the sharp rise in labor costs. 

The U.S. Federal Reserve Bank closely tracks overall inflation, especially core inflation. Core Personal Consumption Expenditures (PCE) is the inflation measure economists prefer to track as it excludes the volatility of energy and food prices. Excluding spikes in energy and food prices allows economists to disaggregate inflation and measure changes in the price of “core” or basic goods and services.