US inflation remains high, affecting Fed decisions

U.S. inflation is still concerning for the Federal Reserve as tariffs from the Trump administration could keep prices high. The core personal consumption expenditures price index, which excludes food and energy, likely rose by 0.3% in February, maintaining a 2.7% annual pace. Government reports expected on Friday will show that consumer spending improved after a slow start to 2025, with personal income increasing by 0.4%. Analysts believe that stronger inflation and consumer spending support the Fed’s decision to hold interest rates steady during their recent meeting. Fed Chair Jerome Powell stated that they want to understand how tariffs will affect the economy before making any changes. In the coming week, several Fed officials will speak to provide more insight into monetary policy challenges. Elsewhere, economic data is set to be released, including durable goods orders and merchandise trade reports. These will help economists estimate the country’s first-quarter economic growth. In Canada, attention will focus on Prime Minister Mark Carney's potential election announcement and economic data reflecting responses to U.S. trade policies. Looking to Asia, several countries will report on manufacturing activity and inflation, as concerns about tariffs impact demand. Europe will see fiscal updates, inflation data, and central bank meetings, highlighting economic uncertainty due to trade tensions. In Latin America, Brazil’s central bank will release minutes from its latest meeting, while Chile and Mexico will also report on economic figures. This week’s data will be pivotal for understanding regional economic responses to rising inflation and trade issues.