WSJ's Take On the Week How This Fed Hawk Views the Economy, Inflation, AI and Jobs
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Dec 21, 2025 
In this engaging discussion, Nick Timiraos, Chief Economics Correspondent at The Wall Street Journal, joins Beth Hammack, President of the Federal Reserve Bank of Cleveland, to share insights on the current economic climate. Hammack highlights cautious optimism regarding inflation and labor markets, discussing challenges in hiring and pricing pressures. She emphasizes the significance of Fed independence and the role of the chair in shaping policy. The conversation also touches on the implications of AI for productivity and potential shifts in the Fed's approach to interest rates.
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One Report Doesn't Shift Policy Views
- Beth Hammack treats single reports as noisy and looks at the full constellation of data before changing policy views.
- She emphasizes business contacts and forecasts over any one CPI print when judging inflation risks.
Businesses Facing Persistent Input-Price Pressure
- Businesses report persistent input-cost pressures and may raise prices in early next year to offset them.
- Firms are also using technology to manage costs but still face upward price pressure.
Labor Market Cooling With Pockets Of Weakness
- The labor market is gradually cooling with pockets of weakness in manufacturing and skilled trades.
- Lower immigration flows and recent graduate struggles may keep job growth modest but unemployment stable.