Fed mouthpiece: December CPI unlikely to change Fed's current wait-and-see attitude

Nick Timiraos, the Fed's mouthpiece, believes the December Consumer Price Index (CPI) is unlikely to change the Fed's current wait-and-see attitude, as officials are likely to want to see more evidence that inflation is stabilizing and gradually declining before cutting interest rates. The Fed has lowered its benchmark interest rate in its last three meetings, most recently in December, even though inflation stopped declining last year. Officials lowered rates due to concerns about a potentially larger-than-expected slowdown in the labor market. For Fed officials to resume rate cuts, they may need to see new evidence that labor market conditions are deteriorating or that price pressures are easing. The latter may require at least several more months of inflation data to become apparent. (Jinshi)