"Fed's megaphone": The Fed's "no rate cut" camp has become more confident
Nick Timiraos, the "Fed's megaphone," wrote in his latest article that three consecutive months of disappointing inflation data have shattered the prospect of the Fed laying the groundwork for a summer rate cut today. The current issue is whether the stronger-than-expected wage growth in the previous quarter will prompt broader internal reflection within the Fed on how to manage the "last mile" of reducing inflation. Over the past six months, Powell has played down concerns about inflation, but the wage growth report released by the US Department of Labor on Tuesday may make the Fed's wait-and-see stance less comfortable. Within the central bank, some officials believe that there is no need to cut interest rates this year because the economy is strong and they are worried that inflation will stay well above 2.5%. The latest data provides them with support and increases the possibility that officials will wait to see more evidence of economic slowdown.
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