July Consumer Price Index (CPI) numbers came in-line with most Wall Street expectations and showed that inflation is cooling and getting closer to the Federal Reserve’s target of 2%. Is this enough for the Fed to make its first rate cut in September? What will that mean for the broader market?
Moody’s Analytics Chief Economist Mark Zandi joins Morning Brief to give insight the CPI numbers and what it means for Fed and the broader economy.
Zandi believes that the Fed should’ve cut rates months ago: “They’ve achieved their objectives. We’re at full employment, 4.3% unemployment rate. You could even argue we’re now on the soft side of full employment and unemployment is moving higher. Inflation is back, consistent with their target, and that argues for a federal funds rate target that’s lower than 5.5%. Five and a half percent is quite high and putting a lot of pressure on the economy and financial system.”
Watch the video above to hear what Zandi thinks of former President Trump arguing that the president should have more of a say in monetary policy.
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