Inflation remains a challenge despite nearing the Federal Reserve’s 2% target, with prices of goods and services still high across the economy. Fed officials, including San Francisco Fed President Mary Daly, are cautious and vigilant, as inflation levels have remained elevated for more than three years. Consumers continue to accumulate debt to cover rising costs, with household debt increasing significantly. Small businesses are also feeling the pressure of inflation, impacting sentiment negatively. The Fed faces a critical decision at its upcoming policy meeting on whether to continue lowering interest rates.
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The article discusses the current state of inflation in the U.S. economy, highlighting that while the Federal Reserve is close to its 2% inflation target, the high prices of goods and services still pose a burden. The analysis touches on the complexity of inflation metrics and the challenges faced by the Fed in managing interest rates. It also addresses the impact of inflation on consumer spending and borrowing, as well as the Fed’s upcoming policy decisions. Overall, the article provides a comprehensive overview of the ongoing inflation issues and the implications for individuals, businesses, and policymakers.
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