Federal Reserve Messenger: December CPI may not change Fed's wait-and-see attitude

Nick Timiraos said that the December Consumer Price Index (CPI) is unlikely to change the Fed's current wait-and-see attitude, and officials may hope to see more evidence of inflation stabilizing and gradually declining before cutting interest rates. The Federal Reserve has continuously lowered its benchmark interest rate in the past three meetings, with the most recent being in December, despite inflation having stopped falling last year. Officials have lowered interest rates due to concerns about the possibility of a greater slowdown risk in the labor market. To resume interest rate cuts, the Federal Reserve may need more evidence to show a deterioration in the labor market or a reduction in price pressures, which may take several months of inflation data to manifest.