Fed Minutes: High energy prices in the short term will continue to put upward pressure on overall inflation.

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ME News, May 21 (UTC+8), the minutes of the Federal Reserve meeting showed that participants expect high energy prices in the near term to continue exerting upward pressure on overall inflation. Participants generally expect the impact of tariffs on core goods inflation to gradually diminish over the course of this year. However, some participants noted that tariff rates could increase further from current levels, thereby leading to greater upward pressure on inflation. A few participants emphasized that after several consecutive years of inflation above 2%, persistently high inflation could have a greater impact on wage and price-setting decisions. Nearly all participants noted that the conflict in the Middle East could persist for an extended period, or that even if the conflict ends, oil and other commodity prices could remain higher than expected for longer. In such a scenario, participants anticipate that factors such as supply chain disruptions, high energy prices, or the pass-through of rising input costs to other prices would continue to push inflation higher. The vast majority of participants indicated that the time needed for inflation to return to the Committee's 2% target could be longer than they previously expected, with risks having increased. (Source: Jinshi)
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