Federal Reserve Messenger warns: CPI is crucial tonight

According to a report by Golden Ten, Nick Timiraos, a Wall Street Journal reporter known as the "voice tube" of the Federal Reserve, pointed out that not all monthly CPI inflation reports are equally important, and in an economy facing price pressure, the impact of January CPI data is greater. Timiraos stated that the inflation report to be released this week may indicate whether the Federal Reserve's efforts to lower inflation have cleared a key obstacle. At the beginning of the year, it is the time for companies to take into account higher food, energy, and labor costs within the year. The Ministry of Labor is scheduled to release January CPI data on Wednesday, and another PPI report on wholesale prices will be released on Thursday. Timiraos emphasized that this data has significant implications for the Federal Reserve. A year ago, inflation seemed to be rapidly moving towards the Federal Reserve's target, but they encountered significant obstacles in the first quarter. In addition, officials also encountered a similar inflation surprise in early 2023, when changes in seasonal adjustment factors offset the progress previously made by the Federal Reserve. In addition, Timiraos also stated that the second reason why tonight's inflation report is particularly important is that Trump is implementing new tariffs, including an additional 25% tariff on steel and aluminum imports, which further complicates the inflation outlook for 2025.