This is CBSI in the world. I'm John Baxter with Joseph Sternberg, member of the editorial

board of the Wall Street Journal. He's in London. He writes political economics, but we're

coming to America. The Federal Reserve meeting in July is now in the history books. Drumphow

the chairman of the Federal Reserve presented how the Federal Reserve arrived at the decision

to raise rates a quarter point. The 11th rate rise since the spring of 22. The Federal

Reserve paused in June and raised in July. The next meeting is in September. So there's

lots of time to speculate. What is the plan? Again, the chairman said, and I'm simplifying,

data, data, data. What data? Especially jobs data. But Joe has written a column. I recommend

everyone to read, to understand what is really important here for politicians and then

for economists and then for those waiting for the Federal Reserve to stop raising rates.

And that has to do with the rate of deceleration of inflation. Joe, I'm going to stop because

that's as far as I can go before I get lost. What is it we're watching for? Thank you.

Well, John, the key point here is to understand what is developing in terms of inflation right now.

And also where the politics of this is going to go next and why because you will have noticed

that a lot of politicians and policymakers, including the Federal Reserve, are claiming credit for

the fact that the inflation rate is lower now than it was certainly a year ago. And they are

suggesting that their policies have caused this. And I think that there are a couple

problems with that from the perspective of households and voters, which are going to continue

to be political factors for the foreseeable future. And the first point is you and I have

discussed many times before, even if the inflation rate is lower than it was a year ago,

prices are still going up. So a declining inflation rate, as long as that number is positive,

does not mean prices are actually falling. It just means that they are rising less quickly.

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