June 2023 / VIDEO
Stubborn Services Inflation Keeps Fed on Guard
We’ll need to see more evidence of a deceleration in services inflation to be confident in overall inflation returning to 2%
US economic growth in the first quarter slowed notably from late 2022, but this was mainly driven by inventory declines. The labour market also appears quite resilient, though layoffs have spread beyond the tech sector. We’ll need to see more evidence of a deceleration in services inflation to have confidence in overall inflation returning to 2%.
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Blerina Uruçi is the chief U.S. economist in the Fixed Income Division. She contributes to the formulation of investment strategy and supports investment and client development activities throughout T. Rowe Price, specifically focusing on the outlook for the U.S. economy, inflation, and monetary policy. Blerina is a vice president of T. Rowe Price Group, Inc., and T. Rowe Price Associates, Inc.