Inflation continues to be the U.S. Federal Reserve’s focus, but for how much longer? On May 10 we’ll get U.S. Consumer Price Index data showing inflation trends for the month of April. The latest nowcasts from the suggests that inflation will come in at just over 5%, showing that inflation is down from its 2022 peak, but nonetheless well ahead of the Fed’s 2% annual goal.
This data will come after the Fed meets earlier in May to set rates, when a 0.25-percentage-point hike is broadly expected, so it will inform the Fed’s subsequent meeting on June 13-14. Fed officials continue to stress that inflation is running too hot and the upcoming CPI report may not change their view. Still a path to a lower rate of U.S. inflation is becoming much clearer.
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