Inflation, consumption and 2023 recession risk after last week's economic data

Just a few weeks ago, mixed signals from labor market, inflation decline trend, consumption and retail at the end of 2022 made the Fed still hesitant about monetary policy and want to observe more. However, the inflation and retail data for 01/2023 released last week seem to further reinforce the Fed's hawkish stance in the coming period. 

January CPI growth figures and 2022 CPI revisions show it is still too early for the Fed to declare victory in the battle to stabilize consumer prices. However, constraints on demand, investment, and production indicate high recession risk if the Fed continues the rate hiking process. Thus, the Fed's "soft landing" scenario seems quite distant. 

Let's join Viet Hustler to reassess the inflation situation, consumption, and recession risk through this week's macroeconomic data.

Disinflation process slower than expected