Wells Fargo argue that as the year goes on, the disinflationary tailwind from goods is probably going to fade but the slower rise in service prices should keep core inflation falling.

Over the course of the year ahead they expect:

  • moderating housing inflation
  • easing pressure on goods-related services like vehicle insurance
  • slowing growth of employment costs

all helping to reduce the inflation of services.

On the March FOMC minutes, WF say that following another month of robust employment and inflation data, it appears that the ten FOMC members who scheduled three or more cuts at the March meeting were incorrect.

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