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Inflation has a 75% chance of rebounding or remaining high, top economist warns
Wall Street underestimating how far the Fed will go to tame inflation: Maria Vassalou
GSAM co-CIO of multi-asset solutions Maria Vassalou reacts to Fed Chair Jerome Powell saying the process of reducing inflation will take time and won’t be smooth on ‘The Claman Countdown.’
Inflation is finally starting to fall, but it would be "dangerous" to assume the problem is fully behind the U.S. economy.
That's according to top economist Mohamed El-Erian, who warned in an op-ed for Project Syndicate this week that there is a 75% chance of inflation either remaining abnormally high, or rebounding and spiking again this year.
The new year began with a bout of optimism that the painful chapter of high inflation in the U.S. was finally coming to a close after the Labor Department reported that the consumer price index fell 0.1% in the month of December and rose just 6.5% from the previous year, the slowest pace since 2021.
But that optimism is misplaced, El-Erian said. He sees equal chances that inflation continues to steadily drop or that consumer prices reverse recent declines and sharply rise again. The most likely scenario, he wrote, is that inflation remains "sticky" and settles around 3% or 4%.
INFLATION STILL OUTSTRIPPING WAGES IN MOST US CITIES
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