According to online reports, Nick Timiraos, the "mouthpiece of the Federal Reserve", pointed out that the Fed staff put forward a clear stagflation forecast at its May meeting, which is important because it may become the basic framework for the Economic Forecast Summary (SEP) that officials will submit next month. As usual, the Fed's description was fairly calm, but Fed staff made clear that a substantial slowdown in the labor market would lead to higher unemployment this year and keep it high throughout the forecast period (to 2027). Fed staff also forecast a "significant" rise in inflation this year and a "smaller" price increase in 2026. Notably, staff said that if their forecasts for 2026 and 2027, when inflation is expected to reach 2%, it is more likely to underestimate rather than overestimate the inflation risk.