“We didn’t make a decision about July. Of course it came up from time to time,” Jerome Powell told reporters on Wednesday, after the Fed conveyed an inclination to restart rate hikes as soon as next month following a break in June.

“A decision hasn’t been made. I do expect it will be a live meeting,” he said, of next month’s gathering.

Powell was pressed to explain where the Fed believes disinflation is coming from given the new economic projections, which reflected higher growth expectations for this year, a lower unemployment rate and core inflation remaining near 4%.

“You’re right,” Powell said, referring to a reporters’ interpretation of the new SEP. “Perhaps more restraint will be necessary than we thought.” “We’ve kinda gone back,” he went on, suggesting terminal expectations have effectively reset to where they stood prior to March’s banking sector stress.

Recall that market pricing for terminal peaked during Powell’s congressional testimony on March 8, the day before SVB’s troubles became national news. Within days, the market had trimmed expectations for peak Fed funds dramatically. Fast forward three months and we’re right back to March 7. (That’s supposed to be clever.)

“Could terminal be even higher than 5.6%?” Jeanna Smialek, the Bloomberg veteran who now covers the Fed for The New York Times wondered. “We’re following the data,” Powell said, adding that the labor market has surprised “many, if not all, analysts.” He called the US jobs market “extraordinary” and “remarkable. “It’s supporting spending. It’s the engine,” he added.

As usual, Powell reiterated that the dots are just projections. He explained what they actually represent, and then proceeded to reiterate that it’s impossible to know, with anything approaching certainty, where rates will ultimately need to peak.

“We always write down what we think the appropriate terminal rate will be. It can be lower or higher,” he said. “There’s no way to know. It can move around. It really will be data-driven.”

While responding to CNBC’s Steve Liesman, Powell said it’s self-evidently the case that the risk of doing too little versus too much is now more balanced after 500bps of rate hikes. And yet, he was unequivocal: Core inflation isn’t receding quickly enough, if it’s receding at all.

“We don’t think we’re there,” he said, flatly. “If you look at the core data you’re just not seeing a lot of progress. There are lags, but it’s more than a year since financial conditions started tightening.”

A reporter from the AP tried to take the dovish side. There’s been some moderation in core services ex-housing, and economists generally think housing services will work in the Fed’s favor going forward. Given that, “why so much hawkishness in the dots?” the reporter asked.

“We’re two and a quarter years into this. Forecasters have consistently thought core inflation was about to turn down and been wrong,” Powell responded. “If you look at core PCE over the last six months, you’re just not seeing a lot of progress.”

Not to put too fine a point on it, but that’s been my pitch for weeks headed into the June meeting. It’s not that I’m saying anything novel. In fact, it’s the opposite: Anyone with eyes can see that core inflation isn’t really moderating. There’s nothing especially complicated about this, and Powell underscored as much on Wednesday afternoon in the US.

He stopped short of blaming wages, opting instead to cite economists and analysts. “Many many analysts believe [wages] will be an important part of” getting inflation back down to 2%, he said. Wage growth has moved down, “but at a very gradual pace.”

Bloomberg’s Michael McKee asked the important question: How is Wall Street supposed to know what the Fed is going to do next? “We don’t go out of our way to surprise markets or the public, but our main focus has to be getting the policy right,” Powell said, stating the obvious. “July will be live. Markets will have to make a judgement.”

Someone from Politico asked an actually important question. How, the reporter wondered, is the Fed thinking about the balance sheet in the context of reserves, Treasury’s cash rebuild, issuance and the RRP facility. The same reporter asked if the Fed was considering lowering the RRP rate to help banks, which are facing stiff competition for deposits from money market funds with RRP access.

It’s “hard to say” which will be greater, reserve reduction or RRP reduction, when it comes to absorbing Treasury issuance, Powell said. The Fed doesn’t think reserves will become scarce by the end of the year. Not all analysts agree with that assessment.

He resorted to a familiar talking point regarding RRP. The facility “doesn’t look like it’s pulling money out of the banking system,” he mused. Actually, it looks a lot like that, depending on your definition of “looks.”

In any case, I won’t litigate that here. “It doesn’t really look like something we would do,” Powell remarked, of a prospective RRP rate tweak, which he plainly indicated is unlikely in the near-term.

In other highlights, Powell said it’s still too early to assess the fallout from the banking stress, and said the Fed is “watching [the] situation carefully” in housing, where activity is perking up again.

He was adamant about two things: Core inflation isn’t coming down fast enough, and the Fed is determined to change that. “We’re going to get inflation down to 2% over time. We have to get it down. And we will,” he insisted.

During the exchange with Smialek, Powell tacitly conceded the futility of the dot plot exercise. “I can’t tell you that we ever have a lot of confidence that we can see where the Fed funds rate will be that far in advance,” he said.