after the review is complete. thank you, and i look forward to our conversation. 1 the views expressed are my own and not necessarily those of other federal reserve board members or federal open market committee participants. i am grateful to brian doyle of the federal reserve board staff for his assistance in preparing this text. 2 see board of governors of the federal reserve system ( 2019 ), “ federal reserve issues fomc statement, ” press release, march 20. 3 see board of governors of the federal reserve system ( 2019 ), “ balance sheet normalization principles and plans, ” press release, march 20. 4 information about the review and the events associated with it are available on the board ’ s website at www. federalreserve. gov / monetarypolicy / review - of - monetary - policy - strategy - tools - and - communications. htm. 2 / 2 bis central bankers'speeches

. so, it is important to consider indicators beyond the headline unemployment rate when assessing progress toward maximum employment, as participation gains might come late in the recovery for some groups. 14 for these reasons, i see no reason employment should not reach levels as strong or stronger than before the pandemic. the number of unemployed in this alternative v / u ratio adjusts for the misclassification of some unemployed workers as employed but not at work ( as reported by the bureau of labor statistics ) and for diminished labor force participation induced by the pandemic ( as estimated by the federal reserve board staff ). see footnote 5. see tomaz cajner, john coglianese, and joshua montes ( 2021 ), “ the long - lived cyclicality of the labor force participation rate, ” finance and economics discussion series 2021 - 047 ( washington : board of governors of the federal reserve system, july ), https : / / doi. org / 10. 17016 / feds. 2021. 047. see also bart hobijn and aysegul sahin ( 2021 ), “ maximum employment and the participation cycle, ” prepared for the jackson hole economic policy symposium, “ macroeconomic policy in an uneven economy, ” august 27, https : / / www. kansascityfed. org / documents / 8361 / jh2021hobijnsahinkcfedversion. pdf. - 7next let ’ s consider price stability. inflation is currently elevated. this is creating challenges for consumers and businesses alike. but the high inflation readings from the spring and early summer were disproportionately driven by a few sectors experiencing specific supply bottlenecks. in may and june, new and used vehicle prices accounted for half of the outsized monthly increases in core consumer price index ( cpi ) inflation. these categories were lesser contributors in july, and in the august cpi their joint contribution declined to essentially zero, as prices finally began to retreat for used cars, offsetting increases in new car prices. i am closely monitoring incoming data for any indications that the breadth of inflation pressures is rising. twenty - four - month core personal consumption expenditures ( pce ) inflation provides one approach to smoothing through the distortions from the pandemic : it is estimated to have been 2. 5 percent in august, above the 2 percent target, but well below the 12 - month measure. the dallas trimmed mean inflation measure provides another indicator of the breadth of inflation pressures