US inflation showed little sign of slowing momentum early in the year and healthy job growth remains supportive of the economy, paving the way for the US Federal Reserve (Fed) to keep interest rates at current levels.
Fed Chairman Jerome Powell will give semi-annual testimony to lawmakers on Tuesday and Wednesday, highlighting the resilient economy as a key reason the central bank is in no rush to cut borrowing costs further.
Fed officials are currently assessing the impact of the Trump administration’s latest policy changes on trade, immigration and taxes.
The Bureau of Labor Statistics figures due out on Wednesday show the CPI forecast to rise 0.3% in January, the fifth time in six months.
Compared to a year ago, core CPI is forecast to rise 3.1%, slightly below the annual figure in December, down 0.2 percentage points.
Jerome Powell also said the Fed would need to see real progress in inflation or labor market weakness before reconsidering a rate adjustment.
