FXStreet — One weak number is not a disaster, but with two weak Numbers, a new Trend could start. The US core inflation was not only in March, weak, but also in April, and also the details of the latest inflation figures were encouraging, said BNP Paribas market analysts.
Several weak months in a row have values in the rule, the impact on the twelve month to the end of the year, and in any case, the overall low values suggest a slowdown in Inflation. The Fed continues to be weak economic growth in the 1. Quarter of your own words, for temporarily. But the two weak core inflation numbers are moving in a row, you might be to the gradual tightening of monetary policy to suspend? As always, The Figures will have an impact on the main inflation indicator of the Fed. May inflation rises to the Central Bank for the end of the year expected rate of 1.8%.
The Fed expects that the case leads to the end of unemployment to wage inflation. If not, will they reduce their estimate of the unemployment rate, the Inflation increases, or the lack of inflation rise with world economic factors. In both cases, the interest rates would be raised, probably even slower. In the meantime, we remain with our forecast of another rate hike in June. Also in the markets, everyone expected almost.
We believe that the Fed still searches for arguments for interest rate increases so that you gets your main Instrument of monetary policy more freedom of action. Comforting, she found, perhaps, the increase in retail sales in April and the upward revision to the February and March numbers.
** FXStreet News Editorial, FXStreet**