, but after progress in bringing demand and supply into better balance in 2023, this rebalancing seemed to stall at the beginning of this year. then in the past month or two, the easing of demand, relative to supply seems to have resumed. the hiring rate, reported by the labor department, slowed relative to the previous three months. in march, the share of workers who voluntarily quit their jobs declined, with the quits rate falling below pre - pandemic levels. this is a sign that fewer workers are jumping to a new and usually higher - paying job. that means firms are in less need to fill vacancies and offer relatively high starting salaries, something that could support moderating wage increases. job creation fell from 315, 000 in march to 175, 000 in april. a big reason for the decline was a sharp drop in the pace of job creation by state and local governments that is unlikely to be repeated, but private sector job creation also fell, another indication that demand for workers continues to slow. that was also the message i take from the unemployment rate in april, which ticked up to 3. 9 percent. it was the 27th consecutive month that unemployment has been below 4 percent, the longest stretch in decades, but it stands noticeably higher than the 3. 4 percent rate last april. meanwhile, the ratio of job vacancies to people looking for work fell to 1. 3, just a tenth of a point above the pre - pandemic level and a sign that the relative shortage of workers related to the pandemic is close to over. 2 / 5 bis - central bankers'speeches wage growth is still a bit higher than i believe is needed to be consistent with our 2 percent target, but it's not that high and recent average hourly earnings data suggest that wage growth is moderating. and some measures of wage growth that tend to be forward - looking have also continued to slow on balance. just like the data on economic activity, i see the labor market data supporting renewed progress in lowering inflation, so now let me turn to the outlook for inflation. last week's report on consumer price index ( cpi ) inflation in april was a welcome relief after three months without progress toward 2 percent. that said, the progress was so modest that it did not change my view that i will need to see more evidence of moderating inflation before supporting any easing of monetary policy. if i were still a professor and had to assign a grade to this

inflation report, it would be a c + - far from failing but not stellar either. headline cpi inflation rose 0. 31 percent month over month. that barely budged the 12month total cpi inflation reading to 3. 4 percent in april from 3. 5 percent in march. more importantly for the inflation outlook, core cpi inflation, which excludes food and energy prices, came in at 0. 29 percent, down from 0. 36 percent in march and 12 - month core cpi fell to 3. 6 percent from 3. 8 percent. accounting for price data from the report last week on the producer price index, forecasts are predicting both monthly headline and core inflation based on personal consumption expenditures, the fomc's preferred gauge, rose a bit less than cpi last month. most forecasts seem to be in the range of 0. 23 to 0. 26 percent, which is less than march's monthly increase of 0. 32 percent. although both march and april may round to 0. 3 percent, it is good to see monthly inflation falling, even if it requires looking out to the second decimal point. looking across these estimates, they suggest three - month annualized core pce inflation could decline around 1 percentage point to about 3. 4 percent as the outsized january increase rolls off the 3 - month average. like the cpi inflation numbers, this is not where i want to see inflation. but, after having these three - month readings accelerate in january, february, and march, i'm happy to see a reversal of this recent pattern. it leaves me hopeful that progress toward 2 percent inflation is back on track. before i say more about the implications for policy, this seems like a good moment to make a few points about a bedrock principle of monetary policy - data dependence. the appropriate setting of monetary policy requires understanding how the economy is performing and some idea of where we think it is going. the latter typically means making a forecast or projection, based on standard macroeconomic models, of key variables and what that implies for policy. but that forecast must be validated by the incoming data. the economy is dynamic, and sometimes new or revised data can significantly change one's understanding of economic conditions and the outlook, which has implications for monetary policy. one data point alone should not change one's view of the economy, and that is why changes in one's outlook and the appropriate path for policy tend to emerge gradually and over time. while you may