Wells Fargo: US inflation environment continues to look benign

Wells Fargo research team suggests that the latest print of 2.2% y-o-y rate of US core inflation suggests no immediate pressure on FOMC to lift rates again soon, but there are few signs of inflation buckling again either as the overall inflation environment continues to look benign as far as the FOMC is concerned.

Key Quotes

“With core inflation at a 2.7% annualized pace over the past three months, the recent trend remains firm. We expect headline inflation will dip further over the next few months due to the drop in both energy and food prices the past few months.”

“Core inflation should move somewhat higher. A weaker dollar is expected to lend some support to core goods prices, while rising labor costs and a willingness among businesses to raise prices should underpin services inflation.”

“We doubt inflation will get out of hand, however, as input cost growth has begun to ease and a modest revival in productivity is keeping higher labor costs manageable.”

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.

Feed news

EUR/USD slides on USD strength, weak German data

EUR/USD is trading below 1.1350. The German IFO Business Climate slightly missed expectations with 98.5 points. The USD is gaining ground despite progress in US-Chinese talks.


GBP/USD recaptures 1.3000 amid Brexit uncertainty, dollar swings

GBP/USD is trading above 1.3000 once again, as the USD loses ground now. Reports about a potential extension of Brexit are circulating but no progress has been made. Trump meets China's Vice PM Liu later.