Inflation for January 2023 increased 6.4% year-over-year, higher than the consensus estimate of 6.2%. Stubbornly high prices have increased the odds of continued rate hikes this year. Goldman Sachs expects the U.S. Federal Reserve to raise interest rates three more times in 2023 by 25 bps each.
However, the still-tight labor market is raising optimism. Kristalina Georgieva, managing director of the IMF, said, "The markets have good reason to be more upbeat because what they are finally seeing is the U.S. economy is likely to avoid recession."
