Headline and Core CPI Hit Fed 2 Percent Target
|U.S. Review
Headline and Core CPI Hit Fed 2 Percent Target
- In speaking engagements this week, Federal Reserve officials indicated that they are comfortable with current inflation trends. That view was supported by the December CPI, in which both headline and core inflation rose above 2 percent over the year for the first time since mid-2014.
- Most economic data releases helped bolster the case for the Fed to tighten policy. Housing starts, industrial production and the Philly Fed's Business Outlook index all topped expectations, while jobless claims fell to near-record lows again this week.
Global Review
Real GDP Growth in China Remains Stable
- Real GDP in China grew 6.8 percent on a year-ago basis in the fourth quarter, essentially unchanged from the 6.7 percent clip that was registered during Q3 2016. Investment spending, however, continues to decelerate. Is Inflation Trending Higher in the United Kingdom?
- The unemployment rate in the United Kingdom remained at an 11-year low of 4.8 percent in November, while wages appear to have accelerated. It appears that the underlying rate of CPI inflation is starting to creep higher. Retail spending, however, was decidedly weak in December.
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