Fed sound bite: recent economic data a mixed bag

‘Fed sounding board’ Nick Timiraos: The Trump administration has introduced a series of policies that have made it more difficult to forecast economic growth and inflation. Deregulation and lower energy prices are likely to boost growth and keep inflation cooler. Recent economic data paints a mixed picture. Spending has slowed, but hiring has held steady and the unemployment rate was 4.1 per cent in February. With the exception of food and energy items, commodity prices fell in most months last year, contributing meaningfully to the slowdown in inflation over the same period, but prices have risen recently. Michael Reid, senior U.S. analyst at Royal Bank of Canada, said the Fed could be ‘put in an increasingly difficult position because on the one hand there are signs that the job market is slowing, although much of the data won't be immediately apparent in the jobs report.’ On the other hand, tariffs could lead to higher inflation figures for the rest of the year.