The January CPI came in much hotter than expected. Does this mean the 2024 rate cuts are off the table? Does it mean inflation is about to flare up again? Let’s take a closer look at what’s happening here and where inflation (and interest rates) might be headed this year. Headline inflation came in at 3.1% while core CPI came in at 3.9%. Both are still quite far from the Fed’s 2% target even though we’ve seen significant progress from the 2022 highs of 9%. One of our big themes for 2024 is that the move from 3% to 2% is going to be much more difficult than the move from 6% to 3%. This is part of why we’ve been ... (full story)