{"id":67548,"date":"2024-04-24T15:33:54","date_gmt":"2024-04-24T20:33:54","guid":{"rendered":"https:\/\/olduvai.ca\/?p=67548"},"modified":"2024-04-24T15:33:54","modified_gmt":"2024-04-24T20:33:54","slug":"oil-prices-arent-the-feds-biggest-problem-right-now-american-demand-is-says-an-economist","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=67548","title":{"rendered":"Oil prices aren&#8217;t the Fed&#8217;s biggest problem right now \u2014 American demand is, says an economist"},"content":{"rendered":"<section id=\"post-headline\" class=\"post-headline-wrapper\n\n                      \"><\/p>\n<h3 class=\"post-headline  \"><a href=\"https:\/\/www.businessinsider.com\/fed-inflation-problem-us-economy-demand-not-oil-price-2024-4\">Oil prices aren&#8217;t the Fed&#8217;s biggest problem right now \u2014 American demand is, says an economist<\/a><\/h3>\n<\/section>\n<figure class=\"figure image-figure-image  \" data-type=\"img\" data-e2e-name=\"image-figure-image\" data-media-container=\"image\">\n<div class=\"aspect-ratio\"><img decoding=\"async\" src=\"https:\/\/i.insider.com\/659c22edec62ab5daf818d5b?width=700\" sizes=\"(min-width: 1280px) 900px\" srcset=\"https:\/\/i.insider.com\/659c22edec62ab5daf818d5b?width=400&amp;format=jpeg&amp;auto=webp 400w, https:\/\/i.insider.com\/659c22edec62ab5daf818d5b?width=500&amp;format=jpeg&amp;auto=webp 500w, https:\/\/i.insider.com\/659c22edec62ab5daf818d5b?width=700&amp;format=jpeg&amp;auto=webp 700w, https:\/\/i.insider.com\/659c22edec62ab5daf818d5b?width=1000&amp;format=jpeg&amp;auto=webp 1000w, https:\/\/i.insider.com\/659c22edec62ab5daf818d5b?width=1300&amp;format=jpeg&amp;auto=webp 1300w, https:\/\/i.insider.com\/659c22edec62ab5daf818d5b?width=2000&amp;format=jpeg&amp;auto=webp 2000w\" alt=\"Inflation could see a resurgence in 2025, BlackRock strategists warned.\" \/><\/div><figcaption class=\"image-caption headline-bold\" data-e2e-name=\"image-caption\"><span class=\"image-caption-text\">Inflation could see a resurgence in 2025, BlackRock strategists warned.<\/span>\u00a0<span class=\"image-source-text\"><span class=\"image-source headline-regular\" data-e2e-name=\"image-source\">Jonathan Kitchen\/Getty Images<\/span><\/span><\/figcaption><\/figure>\n<div>\n<section class=\"post-content typography \n\n                          \" data-track-content=\"\" data-post-type=\"post\"><\/p>\n<div id=\"piano-inline-content-wrapper\" data-piano-inline-content-wrapper=\"\">\n<div data-component-type=\"content-lock\" data-load-strategy=\"exclude\">\n<div class=\"content-lock-content\">\n<div id=\"formContainer\" class=\"inline-newsletter-signup headline-regular insider-today\" data-component-type=\"inline-newsletter-module\" data-event-label=\"insider_today\" data-newsletter-id=\"1\" data-newsletter-title=\"Insider Today\" data-acq-source=\"economyinlinesignup\">\n<section class=\"inline-newsletter-content\">\n<div class=\"inline-newsletter-insider-today-header\">\n<div>\n<div class=\"inline-newsletter-logo-tag\">\n<div class=\"inline-newsletter-logo\"><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/section>\n<\/div>\n<div class=\"premium-content\">\n<section class=\"content-recommendations-component in-content-recirc three-related-posts premium\" data-component-type=\"content-recommendations\" data-component-location=\"\" data-delay-third-party-scripts=\"true\" data-provider=\"dad\" data-excluded-verticals=\"bi-video\" data-premium-state=\"\" data-renderer=\"three-related-posts\" data-size=\"3\" data-container-name=\"content-recommendations-three-related-posts\" data-theme-class=\"\" data-recommendations-placement=\"\" data-root-margin=\"250px 0px\" data-track-view=\"{&quot;event&quot;: &quot;engagement&quot;, &quot;eventCategory&quot;: &quot;in_content_recirc&quot;, &quot;eventAction&quot;: &quot;module_in_view&quot;, &quot;eventLabel&quot;: &quot;module_in_view&quot;, &quot;element_name&quot;: &quot;in_content_recirc&quot;, &quot;lts_segment&quot;: &quot;bi_value_unassigned&quot;, &quot;product_field&quot;: &quot;bi_value_unassigned&quot;}\">\n<div id=\"content-recommendations-three-related-posts\" class=\"content-recommendations-three-related-posts-container content-recommendations-container\">\n<div class=\"three-related-posts-container\"><\/div>\n<\/div>\n<\/section>\n<p class=\"premium\">&#8220;I think what&#8217;s difficult for the Fed currently is actually the part of CPI that is being driven by demand, rather than the supply issues or the energy issues, which are perhaps easier to deal with,&#8221; Samy Chaar, the chief economist of Lombard Odier, told\u00a0<a href=\"https:\/\/www.youtube.com\/watch?v=LcbPTIiKxb0\" target=\"_blank\" rel=\"nofollow noopener\" data-analytics-product-module=\"body_link\" data-analytics-post-depth=\"80\">Bloomberg TV.\u00a0<\/a>The Swiss private bank managed\u00a0<a href=\"https:\/\/www.lombardodier.com\/contents\/corporate-news\/media-releases\/2024\/february\/lombard-odier-reports-full-year.html#:~:text=Lombard%20Odier's%20assets%20under%20management,192%20billion%20at%20end%2D2022.\" target=\"_blank\" rel=\"nofollow noopener\" data-analytics-product-module=\"body_link\" data-analytics-post-depth=\"80\">193 billion<\/a>\u00a0Swiss francs, or $212.8 billion, in assets at the end of December.<\/p>\n<p class=\"premium\">A key inflation metric for the Fed, the Personal Consumption Expenditures Price Index, was little changed in March over its 2.8% reading in February.\u00a0<a href=\"https:\/\/www.businessinsider.com\/fed-powell-pump-money-us-economy-delayed-cut-interest-rate-2024-4\" target=\"_blank\" rel=\"noopener\" data-analytics-product-module=\"body_link\" data-analytics-post-depth=\"80\">Federal Reserve chair Jerome Powell<\/a>\u00a0highlighted the index earlier this week as he signaled that interest rate cuts may come later, rather than sooner.<\/p>\n<p class=\"premium\">The US economy has been strong, with\u00a0<a href=\"https:\/\/www.businessinsider.com\/jobs-wages-growth-in-march-unemployment-rate-labor-market-2024-4\" target=\"_blank\" rel=\"noopener\" data-analytics-product-module=\"body_link\" data-analytics-post-depth=\"100\">job growth<\/a>\u00a0and\u00a0<a href=\"https:\/\/www.reuters.com\/markets\/us\/us-retail-sales-beat-expectations-march-2024-04-15\/\" target=\"_blank\" rel=\"nofollow noopener\" data-analytics-product-module=\"body_link\" data-analytics-post-depth=\"100\">retail sales<\/a>\u00a0also rising more than expected for the month of March.<\/p>\n<p class=\"premium\">&#8220;The problem with the US is the sticky part that comes from services. Services is demand, and that demand needs to come from somewhere \u2014 and that&#8217;s a robust economy,&#8221; Chaar told Bloomberg. A gauge from the\u00a0<a href=\"https:\/\/www.reuters.com\/markets\/us\/us-service-sector-expands-moderately-march-price-pressures-easing-2024-04-03\/\" target=\"_blank\" rel=\"nofollow noopener\" data-analytics-product-module=\"body_link\" data-analytics-post-depth=\"100\">Institute for Supply Management<\/a>\u00a0showed the US service sector expanded moderately in March.<\/p>\n<p class=\"premium\">&#8220;Consumers are consuming because they have jobs, because they have rising incomes,&#8221; Chaar said.<\/p>\n<p class=\"premium\">This means inflation is fueled by demand rather than oil supply, even if a rise in energy prices complicates the Fed&#8217;s job, he said.<\/p>\n<p class=\"premium\">The Fed is now trying to engineer a soft landing for the hot US economy without causing it to tip into a recession.<\/p>\n<p class=\"premium\">&#8220;I would say the biggest challenge here for the Fed is to manage the demand of the US economy,&#8221; Chaar said. &#8220;It comes from domestic America, not from the Middle East.&#8221;<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/section>\n<\/div>\n<section class=\"post-content-more\">\n<div class=\"piano-inline-offer\"><\/div>\n<section class=\"content-recommendations-component three-related-posts\" data-component-type=\"content-recommendations\" data-component-location=\"end-of-article-recirc\" data-delay-third-party-scripts=\"true\" data-provider=\"dad\" data-included-verticals=\"economy\" data-excluded-verticals=\"bi-video\" data-premium-state=\"\" data-renderer=\"three-related-posts\" data-size=\"3\" data-container-name=\"three-related-posts-end-of-article-recirc\" data-theme-class=\"\" data-recommendations-placement=\"\" data-root-margin=\"250px 0px\" data-track-view=\"{&quot;event&quot;: &quot;engagement&quot;, &quot;eventCategory&quot;: &quot;end_of_article_recirc&quot;, &quot;eventAction&quot;: &quot;module_in_view&quot;, &quot;eventLabel&quot;: &quot;module_in_view&quot;, &quot;element_name&quot;: &quot;end_of_article_recirc&quot;, &quot;lts_segment&quot;: &quot;bi_value_unassigned&quot;, &quot;product_field&quot;: &quot;bi_value_unassigned&quot;}\">\n<div class=\"content-recommendations-title-container\"><\/div>\n<\/section>\n<\/section>\n","protected":false},"excerpt":{"rendered":"<p>Oil prices aren&#8217;t the Fed&#8217;s biggest problem right now \u2014 American demand is, says an economist Inflation could see a resurgence in 2025, BlackRock strategists warned.\u00a0Jonathan Kitchen\/Getty Images &#8220;I think what&#8217;s difficult for the Fed currently is actually the part of CPI that is being driven by demand, rather than the supply issues or the [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2,3],"tags":[9218,303,32868,588,592,13351,827,834,3650],"class_list":["post-67548","post","type-post","status-publish","format-standard","hentry","category-economics","category-energy-2","tag-business-insider","tag-fed","tag-huileng-tan","tag-oil","tag-oil-price","tag-price-inflation","tag-united-states","tag-us","tag-us-federal-reserve"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/67548","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=67548"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/67548\/revisions"}],"predecessor-version":[{"id":67549,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/67548\/revisions\/67549"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=67548"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=67548"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=67548"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}