Fed spokesperson Nick Timiraos: Overheating inflation in March may cause the Fed to overreact

ChainCatcher news, Wall Street Journal reporter Nick Timiraos, known as the "Fed's mouthpiece", said that given that Fed officials underreacted to January and February inflation data, overheating of March's inflation data may lead to a greater risk of overreaction. The Fed has tried to avoid basing policy on one or two data points, but the resilience of economic activity so far this year means the case for a rate cut mid-year hinges on whether inflation resumes the steady downward trend it has been on since the second half of last year.

If inflation is muted in March and April, the Fed could cut interest rates in June. But another setback in inflation in March could derail plans for a rate cut in June and delay the first rate cut until the Fed's July meeting, or even later.