It wasn’t in any way magnanimous for the FOMC to state clearly what everyone already knew without any need for aid of GDP calculations. The policy statement for its January 2016 meeting included language that mitigated, if not fully than significantly, the continued reliance on labor indications alone. The Fed says the labor market continues to point in the right direction, even if the economy in all the wrong places slowed just as it judged recovery conditions met.

Information received since the Federal Open Market Committee met in December suggests that labor market conditions improved further even as economic growth slowed late last year. Household spending and business fixed investment have been increasing at moderate rates in recent months, and the housing sector has improved further; however, net exports have been soft and inventory investment slowed.

As for inflation, the Committee still will not specify “partly.”

Inflation has continued to run below the Committee’s 2 percent longer-run objective, partly reflecting declines in energy prices and in prices of non-energy imports. Market-based measures of inflation compensation declined further; survey-based measures of longer-term inflation expectations are little changed, on balance, in recent months. [emphasis added]

Yellen’s “professional forecasters” are mostly unwavering, not surprising since they are the same sort of economists that stand upon the BLS’s straight line of a payroll report, but credit market indications of such things are equally if not more so but in the worst way. Inflation forwards and break-evens improved a little since this statement, but remain far too near the worst levels of 2009.

As noted about Japan earlier today, inflation is the whole thing. You don’t have to take my word for it; the FOMC amended its 2012 Statement on Longer-Run Goals and Monetary Policy Strategy in the most curious way.