US Economic Weekly Update
Our weekly update of the developments and key themes around the US economy
- Core PCE inflation likely remained accelerated in February.
- We expect no cuts in 2025. Easing can resume in Q2 2026 after a tariff induced inflation resurgence has passed
- Our overview highlights the key releases of US economic market data
US Economic Weekly Key Insights
- Chair Powell cited “inertia” as a factor behind the unchanged dot plot medians, despite the deteriorating inflation outlook. In our view, officials are unlikely to deliver rate cuts while inflation is elevated, but will be cautious about when to deliver this message amid growth concerns and uneasy markets.
- The Fed opted to reduce their pace of balance-sheet rundown at the March FOMC meeting. We now expect QT will continue until March 2026.
- Hard data this week suggests cyclical activity has held up, despite deteriorating sentiment and policy uncertainty. Economic activity seems to be cooling, but not falling off a cliff.
- We expect core PCE inflation accelerated to 0.346% m-o-m in February or 2.760% y-o-y, due to higher supercore inflation and continued strength of core goods prices.
- Advance estimates of trade and inventory data as well as personal spending data next week will be important for Q1 GDP growth.
Read our full US Economic Weekly report here.
Contributor
David Seif
Chief Economist for Developed Markets
Aichi Amemiya
Senior US Economist
Jeremy Schwartz
Senior US Economist
Ruchir Sharma
US Economist
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