CNN Inflation Prediction: Interest Rate Policy Not Enough to Curb High Costs!

Jakarta, Pintu News – CNN’s latest inflation prediction analysis sourced from Federal Reserve officials suggests that interest rate cuts alone may not be enough to control price spikes across the economy.

Currently, inflation in the US has risen by about 20% compared to the January 2021 level, and the Fed’s rate-cutting strategy to combat inflation faces serious challenges from ongoing trade policy and economic uncertainty.

The Impact of Interest Rate Cuts on Inflation, Employment, and Consumer Costs

The Federal Reserve has held interest rates steady for nine consecutive months, trying to assess how trade policy is changing the situation. However, job growth has slowed significantly since the summer, and unemployment among young and minority workers has risen sharply.

Data from the Labor Department shows that there are currently more unemployed people looking for work than there are job openings. Beth Hammack, President of the Cleveland Fed, expressed her concerns in an interview with CNBC on September 29, “We have failed to meet our mandate on the inflation side, our goal of 2%, for over four and a half years. I continue to be concerned about where we stand from an inflation perspective.”

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Trade Policy Complicates Economic Recovery

The economy was actually on a path of a so-called “soft landing” at the end of last year. However, trade policies enacted in January have dramatically changed the economic picture. These policies have paralyzed businesses, delayed hiring plans, and created new price pressures across the economy.

Philip Straehl, Chief Investment Officer, Americas, at Morningstar Wealth, explained to CNN, “The economy is in a tug-of-war. The Fed is making trade-offs for the labor market as tariff uncertainty weighs on companies, you look at what’s happening with federal workers and the impact of AI on certain industries.”

Economic divide widens as inflation persists

Low-income families have been hit hardest by sustained inflation. Retailers report that these households have significantly reduced spending or switched to cheaper alternatives just to make ends meet. Credit scores are declining at the fastest pace since the Great Recession, partly because student debt repayments have resumed after a long pause.

Charles Scharf, CEO of Wells Fargo, told CNBC on September 10, “There’s a big difference between high- and low-income consumers that continues to be a real problem. Low-income groups are spending the money they have, so their balances are below pre-pandemic levels; they’re living on the edge.”

Conclusion

With official economic data that provides critical guidance on employment, inflation, and trade delayed, the Fed seemed to be walking blindfolded at a crucial time. Markets and consumers are watching CNN’s inflation news closely, waiting to see if CNN’s inflation predictions will prove accurate and if inflation will fall as expected.

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Reference

• Watcher Guru. CNN Inflation Prediction Warns Rate Cuts May Not Beat Surging Costs. Accessed on October 14, 2025