Lates News

Chief economist Brian Jacobsen of Annex Wealth Management stated: The February inflation data was originally heading in the right direction, but the emergence of conflict in the Middle East has changed this trajectory. Energy, which was expected to bring deflation, may now bring inflation instead. The fertilizer market is in chaos, and food prices may start to show signs of accelerating inflation. The food and energy components in the CPI make up 20% of the consumer basket, but they play a role in shaping consumers' views on inflation beyond their own size. The Federal Reserve is likely to emphasize maintaining interest rates and staying vigilant against inflation, but monetary policy cannot reopen the Strait of Hormuz, so these tough statements are likely just verbal. The Fed will not actually take action. If they do take action, they may repeat the mistake made by ECB President Trichet in 2011 when he panicked and raised interest rates due to rising commodity prices, which exacerbated the economic recession in the eurozone.