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Trump urges for interest rate cuts again, but the 'New Federal Reserve News Agency' dampens expectations: the April CPI did not reflect the impact of tariffs, and inflation pressure will emerge afterwards.
According to Timiraos, economists believe that tariffs will end the recent inflationary lull and drive up prices in the coming months; the tariff policy is like a "roller coaster," with April's inflation providing almost no reason for the Federal Reserve to stop watching; if there are no extensive tariffs in April, this data might be enough to prompt the Fed to resume rate cuts, while costs may rise in the coming months, possibly leading the Fed to remain inactive.
After the CPI reported good news, Trump called out again: the Federal Reserve should lower interest rates quickly, do not block the USA's rise.
① After the inflation report was released, USA President Trump once again pressured Federal Reserve Chairman Powell, demanding that the central bank take action to lower interest rates; ② Trump imposed a 10% baseline tariff on nearly all countries and implemented or threatened additional tariffs on key industries, raising concerns about rising costs for USA consumers and economic slowdown.
Dollar Could Lag U.S. Equities After U.S.-China Progress -- Market Talk
In April, the USA's CPI unexpectedly fell to a new low since 2021, while the market expects tariff impacts are still to come.
① In April, the CPI in the USA rose 2.3% year-on-year, with an expectation of 2.4%; the core CPI grew by 2.8% year-on-year, meeting expectations; ② Since April is merely the first month of the USA's comprehensive tariffs taking effect, the market expects a larger impact to become clear in the following months; ③ Even in such a report, traces of soaring prices of imported Commodities can still be found.
Another disappointment! USA's April CPI increased by 2.3% year-on-year. The pressure from tariffs hasn't taken effect yet, but are there undercurrents?
Affected by the stable prices of Outfits and new cars, the CPI in the USA rose less than expected in April, indicating that there is currently not a high urgency for companies to pass on higher tariff costs to consumers.
Inflation cools down! The USA's April CPI year-on-year is 2.3%, the lowest level since February 2021.
The core CPI increased by 2.8% year-on-year, the lowest rate since the inflation outbreak in the spring of 2021. Housing costs remain a key factor in inflation, while airfares, used car prices, and food prices have seen a decline. Nevertheless, the impact of tariffs has not been fully realized, and companies may still be digesting inventory.
