Inflation rose slightly in March as the Consumer Price Index (CPI) rose. 3.5 percent From 1 year ago.
“Core” inflation, which excludes volatile food and energy prices, also rose for the first time in a year. 3.79% This is up from 3.76% in February.
Inflation has fallen sharply from a peak of 9% in June 2022.But the path to achieving the Fed’s goals is 2% annual inflation target The CPI has proven elusive as it has hovered between 3-4% for nearly a year.
Following Wednesday morning’s new CPI announcement, CME Fedwatch predicted the probability of a June rate cut to be just 21 percent. Forecasting algorithms do not predict that the odds of a rate cut are higher than those by September.
“The lack of downward momentum in core inflation will be met with some discomfort domestically.” [Fed]In particular, some Fed officials are increasingly wary of cutting rates amid persistent inflation,” EY senior economist Lydia Boussour and chief economist Gregory Daco said in an analysis on Wednesday.
“Still, many people will wait to look at their records.” favorite inflation gauge — PCE Inflation — before adjusting our view later this month,” they wrote, referring to the Commerce Department’s Personal Consumption Expenditures (PCE) Price Index, the Fed’s preferred inflation measure.
The Hill’s Tobias Burns has more information.
