Fed, Trump and inflation
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Inflation, Tariffs
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inflation, stock futures
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Donald Trump is pressuring the Federal Reserve to cut interest rates following a favorable inflation report, arguing that the current base rate is too high with a modest 2.3% annual CPI increase. However,
Even so, a rollback of some levies since "Liberation Day" may reduce the impact on inflation. Trump paused a large swath of so-called "reciprocal tariffs" within days of the announcement. On Monday, Trump temporarily slashed tariffs on China from 145% to 30%.
U.S. consumer prices rebounded moderately in April as declining food costs partially offset rising rents, leading to the smallest annual increase in four years, but the inflation outlook remains unclear against the backdrop of tariffs.
The inflation backdrop improved in April, with a slight annual decrease reflected in the consumer-price index based on a 2.3% yearly rate. But that doesn't necessarily give the Federal Reserve an all-clear to cut rates next month,
The reduced U.K. growth and inflation would come on reduced demand and trade diversion as the rest of the world cuts their exports to the U.S., Lombardelli said in London.
If you're waiting for the Federal Reserve to lower borrowing costs, don't hold your breath. Out of the multiple Federal Reserve officials who spoke Friday, none sounded in a big hurry to cut the central bank's benchmark interest rate.