The latest inflation numbers suggest that lower interest rates may appear around the same time as our newly chiseled beach bods (hopefully at least one of those things proves true).
The Consumer Price Index for February grew 0.4% for the month and 3.2% year over year, according to the latest inflation report from the Bureau of Labor Statistics. The folks at CNBC noted the annual bump was ever-so-slightly ahead of the 3.1% Dow Jones consensus. That said, inflation remains above the Fed’s target of 2%.
In other words: Don’t expect the Fed to ease interest rates quite yet. Most economists estimate the first rate cut will occur in summer, according to the Associated Press.
“Reports like January’s and February’s aren’t going to prompt the Fed to lower rates quickly,” Robert Frick, corporate economist at Navy Federal Credit Union, told CNBC.
Federal Reserve chairman Jerome Powell told Congress last week that “it will likely be appropriate” to start easing rates sometime this year. He also warned that taking action too soon could reverse the work the Fed has done to rein in inflation.
The Fed’s next two-day meeting is scheduled for Wednesday, March 20.
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