The US labor market The “reflation” narrative is lingering, and the “relaxation” process of the labor market and Tariff 2.0 ne to be paid attention to in the mium term
The process of “loosening”, which may increase buy phone number list the stickiness of service inflation in the mium term.
Although the growth rate of average hourly wages of U.S. residents slow down slightly in December,
judging from leading indicators of the U.S. employment market, such as the U.S. ISM Services PMI
Price Index and the U.S. Small Business Hiring Plans Index, there is a possibility that the U.S. employment market will warm up in the short term, which may enhance the stickiness of service inflation in the mium term.
The Unit States may still experience slow
Dflation” in 2025, with uncertainty mainly coming from Tariff 2.0. From the overall perspective of
2025, there is still a lot of room for the wage growth rate and core nonrental service inflation to fall
back, and the employment market may mobile lead turn into an “antiinflation” driving force in the later period.
If the impact of Trump’s 2.0 policy is not taken into account, the base effect may cause the US CPI to fall sharply yearonyear in JanuaryApril 2025, and then rebound slightly and fall back to around 2% by the end of 2025.
Risk Warning
Geopolitical conflicts escalate; US economic slowdown exces expectations; F turns hawkish beyond expectations
The US CPI inflation in December was weaker than market expectations, temporarily suppressing the previous “inflation trade”. Structurally, the weakening of durable goods inflation is the main reason. Looking ahead, can the US “deinflation” process continue in 2025 and how to understand the disturbance of Tariff 2.0?
1. U.S. core CPI in December was slightly weaker than market expectations, and the F’s expectations for rate cuts increas slightly
The U.S. CPI in December was slightly entering artificial intelligence: the real beginning of transformation lower than market expectations, and both the “broadness” and
“stickiness” of inflation declin. In December, the US CPI was 2.9% yearonyear and 0.4%
monthonmonth, in line with market expectations, but the core CPI was 3.2% yearonyear and 0.2% monthonmonth, slightly weaker than market expectations The US labor market.