US inflation remains stagnant, with Fed likely to maintain interest rates

From The National: 2024-05-31 10:28:03

US inflation remains stagnant, with the Federal Reserve likely to maintain elevated interest rates. PCE price index rose by 0.3% in April, unchanged from March. Headline and core inflation steady at 2.7% and 2.8%. Fed closely monitors PCE for monetary policy decisions, expected to keep rates steady between 5.25% and 5.5%. UAE and Saudi Arabia to maintain rates. Delay in Fed rate cuts due to hot inflation data and strong economic activity. ECB and Bank of Canada expected to cut rates, Bank of England could follow in June. Fed’s delay will impact central banks in Asia-Pacific. PCE report last major metric before Fed’s blackout period. NY Fed President believes current policy level is restrictive enough. Williams rules out rate increases, expects inflation to decline later this year. Interest rates in US may need to come down eventually based on goal achievement and risk balance. Fed to release updated economic forecasts on June 12, with March forecast predicting three rate cuts and PCE inflation at 2.4%.



Read more at The National: US inflation shows little progress as next Fed decision looms