A man shops for produce at a supermarket in Monterey Park, California on September 9, 2025. Frederic J. Brown/AFP/Getty Images Washington —

The Federal Reserve stepped in last month to safeguard America’s labor market, cutting rates by a quarter point to shore up a slowdown in hiring. But it has another equally important problem still to address — one that has driven up the cost of living in the United States and continues to strain lower- and middle-income households.

Inflation — the other side of the Fed’s dual mandate — still hasn’t returned to pre-pandemic levels and President Donald Trump’s trade war has already pushed up some prices. The Fed came within a hair of its 2% target by the end of last year, but then Trump’s aggressive policies shifted the tectonic plates of the

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