Economists now, on average, predict inflation will be 2.6 per cent this year, up from 2.2 per cent before the election, according to forecast aggregator Consensus Economics, due to the risk that Trump’s biggest policy pledges on immigration, tariffs and tax cuts, and cutting red tape could raise the cost of living.

Gallup’s annual Economy and Personal Finance poll found that, in 2024, respondents named inflation as the most important financial problem they face today. And despite some optimism that the economy will soon improve, a 2025 Allianz Life study found that 60% of Americans believe inflation will get worse this year.

And almost as expensive due to years of cash flowing in to escape the inflation in neighbouring countries such as Argentina. What’s nicer than an ocean-view apartment to preserve your wealth in real terms?

Unhedged feels only a little reassurance. We thought inflation was all but beaten four months ago, and were wrong; once burnt, and all that. Despite this good report, however you look at it, core inflation is closer to 3 per cent than 2 per cent, and the trend is sideways, not down.

Reports of the demise of US inflation have been greatly exaggerated. Today on the show, Rob Armstrong and Aiden Reiter discuss the continuing high numbers and what the Fed might do about it this year. Also they go long Ohio State and short New Year’s resolutions.

Inflation likely accelerated in December, putting pressure on the Federal Reserve to keep interest rates relatively high.

Experience suggests that abundant and cheap money is not a harbinger of price or financial stability, much less of sustained economic growth. The European Central Bank should bear that in mind as it seems prepared to loosen monetary policy further this year.

Policymakers left their benchmark rate unchanged amid signs that the economy is humming along, defying the president’s tradition-bucking pressure on the central bank.

The central bank’s decision to pause at its first meeting of 2025 followed a series of cuts that began in September to account for progress already made on getting inflation down. Over the course of three meetings, the Fed lowered rates by a full percentage point to a range of 4.25 percent to 4.5 percent, which was maintained on Wednesday.

Outside of a U.S. President bending norms, the Fed also faces challenges in achieving its economic objectives. Inflation remains above its 2% target: Its preferred measure is at 2.4%, though core prices — considered a better gauge of where inflation is headed — rose 2.8% in November from a year ago.

The US Federal Reserve left its benchmark interest rate unchanged Wednesday after cutting it three times in a row last year, a sign of a more cautious approach as the Fed seeks to gauge where inflation is headed and what policies President Donald Trump may pursue.