Sticky Inflation Is A Quagmire For Tariff Plans

2025-02-14 10:05:00 ET

Summary

• U.S. inflation rose 3% over the prior year in January, the Bureau of Labor Statistics said on February 12.
• Prices rose in January by 0.5% from the prior month, nudging the annual increase up to the psychologically testing 3% threshold.
• Inflation expectations are rising: the University of Michigan’s consumer sentiment survey released on Friday showed the anticipated rise in prices over the next year jumped to 4.3% in February.

By Breakingviews

The U.S. economy is still running too hot for comfort. Prices rose in January by 0.5% from the prior month, nudging the annual increase up to the psychologically testing 3% threshold. It's another roadblock for further rate cuts from the Federal Reserve. More importantly, it leaves even less room for President Donald Trump, whose tariff plans could stoke inflation further. Something must give – raising the specter of recession....

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