The American consumer today Price index The report (CPI) will be a vital workplace for everyone Fed cuts this year. Economists at Commerzbank analyze why it is simply too early in the current circumstances to consider cutting rates.
Disinflation is a marathon, not a sprint
We expect the base rate to be similar to the monthly rate in December. The annual rate is likely to drop only slightly. The annual rate for the overall rate should fall somewhat more significantly, but here the dynamics on a month-to-month basis are similar. In other words, a continuation of the momentum of recent months.
At this point, someone might ask why I am commenting so extensively on today's numbers, when at first glance they contain little new information. There are several reasons. First, of course, we may be in for a surprise today. And the surprises of recent months have clearly shown that things can then be very unstable.
On the other hand, these numbers are also likely to underline what the Fed has been emphasizing heavily over the past two weeks. Specifically, a few more months of good data may be needed before the all-clear can be given. If the numbers come in as expected, it should signal to the last market participant that a rate cut as early as March is unlikely.