Thursday, February 13, 2020
Rents lift U.S. inflation; Slight rise in unemployment
Consumer prices in the U.S. picked up this past month. At the same time, the number of U.S. citizens filing for unemployment rose within the past week. According to the article, these two factors suggest that the economy is in stable condition. A condition so stable that the Federal Reserve could keep interest rates on hold this year. Jerome Powell had recently stated, "the economy is in a very good place, performing well. Over the next few months we expect inflation to move closer to 2%." Last week the government reported that 225,000 jobs were created last month. The unemployment rate rose to 3.6% as more people decided to enter the labor force. Despite the slight increase, the labor market has been on an 11 year expansion and consumer spending has been inclining right along with it. It was reported that rent had been rising about one-tenth of a percentage for the past few months which has had an impact on core inflation.https://www.reuters.com/article/us-usa-economy/rents-lift-us-core-inflation-weekly-jobless-claims-rise-slightly-idUSKBN2071XI
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2 comments:
These are all really encouraging factors to see in the economy. I agree that it was important to note that unemployment rose because more people entered the workforce. This is good for the economy as those people will begin to spend more as they bring in income. Hopefully all this trends continue and the economy continues to thrive.
A concern with the economy currently is that we have been expanding for so long, we are do for a contraction. Based on this information, it seems like the economy will continue to be expanding for awhile longer. Jerome Powell seems very comfortable with the route the economy is going, so I see no reason to expect anything other than expansion for awhile.
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