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Goldman chief economist Hatzius expects July CPI to stay benign

He forecasts headline CPI at about 0.05% month on month and core near 0.19%, and says temporary tariff, oil price, and World Cup effects are fading.

Reported · Written up by our desk · Economy

Goldman Sachs chief economist Jan Hatzius told Fox Business in an interview that he expects this Wednesday's July consumer price index to look similar to June’s more benign print, a view that could reduce pressure for Federal Reserve action on interest rates.

Hatzius forecast headline inflation around 0.05% month on month and core CPI near 0.19%, both in line with or slightly below consensus, and said the hotter inflation seen earlier has been driven by temporary factors that are now fading.

In the interview, Hatzius attributed earlier inflation pressure to tariff pass-through, the impact of higher oil prices on the headline index, and a World Cup related effect, while arguing that these influences are now easing.

He also pointed to a sharp downward revision to Goldman's underlying payrolls trend, from around 75,000 to just 5,000 a month, and said he does not think a rate hike is needed this year as rent and wage inflation continue to trend down.

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