One of my go-to economic data experts emailed on Thursday morning about the latest inflation report, which showed prices actually falling in June and up only 3 percent over the past year.
It was, he declared, “beautiful.”Your aesthetic sense may vary, but we’ve now had two months of really good price data, enough to puncture the bubble of pessimism that, um, inflated early this year.
Many economists argued, however, that the bad data was just noise, largely reflecting one-time price resets at the start of the year.
Note that the Federal Reserve focuses not on the Consumer Price Index but on an alternative measure, the personal consumption expenditure price index, which isn’t in yet for June.
And since the Fed is supposed to skate to where the puck will be, not where it is right now, there’s now an overwhelming case for interest rate cuts.
Persons:
we’ve, there’s
Organizations:
Federal Reserve, Consumer