Cook: Based on the available data for September, it is estimated that the PCE price index rose 2.8% in the 12 months ending in September—significantly above the 2% target. Core inflation, which excludes volatile food and energy categories, was also estimated at 2.8%. Both of these readings are as high or higher than those from a year earlier, propped up by an increase in tariff-affected goods prices. My outreach to business leaders suggests that the pass-through of tariffs to consumer prices is not yet complete. Many firms have adopted a strategy of running down inventories purchased at lower price levels before raising prices. Others have reported waiting until tariff uncertainty is resolved before passing increases on to consumers. As new car models, clothing lines, and other products enter the market, that process will continue to provide firms with opportunities to reset prices. As such, I expect inflation to remain elevated over the next year.