The cost of living is for voters heading to the polls, but the Federal Reserve saw America’s persistent inflation problem Wednesday and opted not to do anything about it. At least for the next six weeks, anyway.

Despite consumer prices gaining 3.7% over the past year and the Fed’s preferred inflation gauge stubbornly remaining 50% above the central bank’s target, the decision to hold interest rates steady was widely expected.

That’s because changing rates is a blunt instrument that can inflict serious damage on the economy when ill-timed or used improperly.

“Interest rates get in the cracks,” Fed Chairman Kevin Warsh said in a press briefing Wednesday. “They affect everything.”Central bankers just last month hiked rates for the first time in more than three years, and they want to wait a bit to see how the economy responds before bashing it over the head again with another rate hike.

“Ensuring price stability and watching inflation is not about some fixed date on a calendar or some isolated data point,” Warsh said. “It’s about ensuring we have clear objectives and the right monetary policy.”Warsh said he was encouraged by the reduction in inflation expectations since the Fed raised rates in September.

By waiting, however, the Fed is also taking a significant gamble. The Fed risks another 2021-like mistake, when it assumed the inflation monster staring the economy directly in the face could be defeated by just ignoring it. (The Fed was disastrously wrong). This time may truly be different, and not acting with haste could prove prescient.

Or it could force the central bank to give the economy some December shock therapy that it may have been able to avoid with an October rate hike.

Jobs. Hiking rates increases businesses’ borrowing costs, which leaves them with less money to hire.

Now may be a perilous time to mess with the job market: The US economy added only 29,000 jobs in September, well below expectations. And the September report showed that the economy added 60,000 fewer jobs over the previous two months than previously believed.

The labor market is by no means in bad shape, but it has been on shaky ground. The US economy lost 10,000 jobs in July and in seven of the past 16 months. Although unemployment remains at a healthy 4.2%, economists describe the economy as “low hire, low fire.”In other words, your position may not be at risk, but if you leave your job, you may have trouble finding a new one.

Markets. Treasury yields moved higher since the last Fed rate hike, with bond yields at one point hitting multi-decade highs. Yields have slipped a bit since, returning to where they were in mid-September, but the still relatively high bond yields can help give the Fed cover, because they have an effect similar to the Fed funds rate, slowing the economy and inflation.

The Fed also doesn’t like to surprise investors – even in Warsh’s new keep-‘em-guessing era. The market had priced in a 91% chance that the Fed would hold rates, according to CME’s FedWatch tool, and a hike could have sent the markets into a painful rebalancing.

Timing. The Fed’s decision may also have been influenced, at least somewhat, by the upcoming election. Narayana Kocherlakota, the former Minneapolis Fed president, told my colleague Matt Egan that the Fed hesitated to raise rates Wednesday because it wanted insulation from President Donald Trump’s criticism. But the Fed throughout its history has changed rates many times just as voters were heading to the polls, my colleague Elisabeth Buchwald also noted.

The “transitory” error: The Fed typically doesn’t get involved when supply shocks like the Iran-war-induced energy crisis cause inflation. They’re notoriously temporary, hard to predict and insensitive to rate changes.

But supply shocks sometimes lead to bigger problems that the Fed help fix. The Fed should know: It just went through this.

As the economy emerged from the pandemic, the Fed made a mistake with inflation, declaring it a result of a “transitory” supply shock related to the Russia-Ukraine war and massive supply chain snarls. It ended up becoming the most significant inflation problem in a generation. The Fed, caught off guard, was forced to raise rates at a historic pace – three consecutive hikes of three-quarters of a percentage point.

Ultimately, the Fed succeeded at lowering out-of-control inflation to more manageable levels, but not before consumer prices peaked at an annual rate of 9.1%, the highest in four decades. This time may be no different: Inflation is already spilling over into other parts of the economy.

Particularly concerning in the September consumer inflation report was the surprising rebound in housing and rent costs, a significant contributor to inflation that had cooled off in the spring and summer. And the cost of other services rose higher than expected, too – prices that tend to rise (and stay high) as yoga studios, lawn services and the like charge their customers more to make up for their rising costs.

Also driving inflation: Investment in data centers and technology powering AI has propelled the economy into overdrive – and maybe helped overheat it. Prices for electricity, building materials, labor, and personal tech like smartphones and laptops have all risen as a result.

More war? This energy price spike could get worse before it gets better. Trump has strongly hinted (and CNN has reported) that the United States and Israel could escalate the war with Iran after the midterm elections, potentially sending oil prices higher.

It would be foolhardy for the Fed to make a decision based on a rumor. And energy prices can quickly swing lower. For example, the Trump administration’s announcement of an energy ceasefire in Russia has held surprisingly well, dramatically increasing the amount of diesel Russia produced in the past couple weeks, which could significantly lower global diesel prices – if Ukraine continues to hold off on its drone strikes on Russian refineries.

But the prolonged energy price spike is already raising prices across the economy, and waiting to hike again could place the Fed behind the curve.

Boiling frogs. Rate hikes work with a delayed effect, and sharper rate changes can have deleterious effects on the financial system, markets and the economy. This economic frog tends to stay in the pot when the heat is turned up gradually.

If escalations in the Iran war and Russia-Ukraine war resume, that could force the Fed into a difficult position of hiking rates by even more than expected in its next meeting in December – potentially by a half point, in a kind of make-up call.

The massive, successive rate hikes throughout 2022 sent the stock market into its biggest annual decline since the financial crisis and put the housing market on ice. But the economy didn’t go into a recession – a trick the Fed has rarely pulled off when it hikes rates. It’s not a wager a lot of economists are eager to place again.