Unhedged Will US inflation ever go below 3%?
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Jan 16, 2025 High U.S. inflation isn't going away as quickly as some hoped. The hosts delve into recent trends showing inflation hovering near 3%, despite the Fed's 2% target. They discuss the persistent inflation in services, contrasting with falling costs in other areas. Humor comes into play when reflecting on the fleeting nature of New Year's resolutions, intertwined with some lighthearted jokes about the Ohio State Buckeyes. It's a blend of serious economic analysis and playful commentary on everyday life.
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Inflation Prediction vs. Reality
- In September 2022, Unhedged predicted inflation was beaten and the US economy cooling.
- However, core inflation remained at 3.25%, prompting a discussion on the accuracy of their prediction.
Shifting Inflation Drivers
- Housing and wage inflation are no longer the primary drivers of overall inflation.
- While still high, they have steadily declined, indicating a shift in the inflationary landscape.
Services vs. Goods Inflation
- Service prices remain high and contribute to sustained inflation, while goods prices are decreasing.
- This divergence presents a complex scenario for managing inflation effectively.