Those rates have spiked since 2022 amid efforts by the Federal Reserve to tackle surging inflation – but while the central bank was widely expected to introduce rate cuts in the second half of this year, those hopes have receded somewhat amid surprisingly high recent consumer price index (CPI) readings.
The core CPI, which excludes food and energy costs, increased by 3.8% in March on a year-over-year basis, while the overall inflation rate jumped by 3.5%, a sharper rise than expected.
The Bureau of Economic Analysis indicated in remarks accompanying its latest GDP report that consumer spending, exports, and state and local government spending had all ticked lower in the first quarter of the year.
Federal government spending was also down, while residential fixed investment increased and imports accelerated.
Mortgage Bankers Association vice president and deputy chief economist Joel Kan noted that the new figures marked the weakest quarterly GDP growth rate since the middle of 2022, and said the Fed still appeared on course for cuts at some point before 2025.
Source: mpamag.com