On Friday’s broadcast of Bloomberg’s “The Open,” economist and President of Queens’ College Dr. Mohamed El-Erian reacted to the January Personal Consumption Expenditures (PCE) price index inflation number by stating that it’s “bad news as bad news. And it’s bad news across the board.” And that “disinflation can’t be said anymore. Inflation is heading the wrong way.”
El-Erian stated, “This is bad news as bad news. And it’s bad news across the board. It’s bad for the economy. It’s bad for livelihoods. It’s bad for bonds. It’s bad for stocks. It is just bad news.”
Later, host Jonathan Ferro asked, “Chairman Powell in that meeting talked about the disinflationary process beginning, then we all read the minutes. You counted how many times he said ‘disinflation’ in the news conference, eleven right? Then, in the minutes, zero. What’s going on there?”
El-Erian responded, “So, I refer back to what you said yesterday is the question, can they massage — that’s the word you used — massage the minutes to reflect subsequent data? I don’t know. … But the minutes were not consistent with the message of the press release. But I think even this word disinflation can’t be said anymore. Inflation is heading the wrong way.”
Later, he added that there is “hesitant progress” shown by the report, but the key is that more work needs to be done by the entirety of the government.
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