Breitbart economics editor John Carney said Tuesday on Fox Business Network’s “Kudlow” that the latest inflation numbers meant the Federal Reserve could not cut interest rates this year.
“John, let the games begin. How bad was this?” host Larry Kudlow asked.
“This was real bad, not just because they [the latest inflation numbers] were higher than expected, this was confirmation that January was not an anomaly, that inflation is going back up,” Carney said.
“We have not made any progress on inflation for eight months. Now, for the last four months, it has been creeping back up. Four months in a row of headline inflation month to month going up. This is, means the Fed cannot cut. They say they are looking for more confidence. I don’t know how you can look at these numbers and be more confident.” Carney said.
Carney argued that the economy will not give the Fed the opportunity to cut in the first half of this year, which would mean the Fed would be facing the question of reducing interest rates for the first time in this cycle just before the presidential election.
“I don’t think they can do it in September. If they tried to cut in September, that would be looked at as the most political cut ever. It will create backlash. They want to defend their independence. They will not cut in September,” Carney said. “If they don’t cut in the first half, they don’t cut in the back half. Maybe they cut in November, like the day after the election.”
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