Federal Reserve Governor Milan: Recent inflation data has been significantly biased upwards due to the government shutdown; recent data should move in...
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TL;DR
Federal Reserve Governor Milan noted that recent inflation data was skewed upward by the government shutdown, particularly affecting housing inflation, and suggests a dovish policy shift to avoid recession risks.
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Federal Reserveinflation datagovernment shutdowndovish policyrecession risk
Mars Finance reports that on December 22nd, Federal Reserve Governor Milan stated that last week's inflation data showed some anomalies due to the government shutdown. The shutdown distorted the housing inflation index to some extent, resulting in a significant upward bias in the full-year CPI. Recent data should push people towards a dovish stance. If we do not adjust policy, we will face an increasing risk of recession. We believe that policy rates will eventually be lowered. (Jinshi)