What To Expect From Friday’s Report On Inflation | Global News Avenue

The Fed’s preferred measure of inflation may slow down in January, reassuring that the increase in cost of living is slowing to pre-pandemic levels.

A report on Friday could indicate that the cost of living increased by 2.4% in January, based on a measure of personal consumption expenditure. Dow Jones News and Wall Street Journal. Data from the Bureau of Economic Analysis may show a slowdown in growth of 2.6% in December.

Median forecasts require food and energy prices that exclude core PCE inflation to 2.8% per year, the lowest since June.

Based on expected forecasts, it can help people feel at ease about the financial market, that is, the outbreak of inflation after the outbreak of the economy begins in 2021 is on the last leg. Inflation has proven to be stubborn in recent months, leading to Fed officials Put plans to cut borrowing costs and cut loans on ice for the time being.

The decline in PCE inflation may be particularly noteworthy given that the Fed views PCE as inflationary pressures than the more widely reported consumer price index. An unexpected surge in January. Through CORE PCE, the Fed raises interest rates to slow the economy and restores inflation to its 2% annual target.

David Mericle, a senior economist at Goldman Sachs, wrote in a comment that the expected results will “reduce concerns about lack of progress late last year.”

Cooling PCE inflation will also increase economists’ suspicion that CPI inflation is at least at least Part of it is data fluke Instead of really accelerating consumer prices.

Big “if” inflation: tariffs

Although Inflation may dropPresident Donald Trump’s economic policies can Cause it to shoot again.

Specifically, economists are concerned about the president’s announcement of tariffs. He proposed taxes on imports of goods in Mexico and Canada, all steel and aluminum, and unspecified “reciprocal” tariffs on countries that tax U.S. import taxes. These tariffs will take effect in the coming months.

Many economists believe that we consumers will eventually pay for these tariffs, which will drive higher inflation.