Fed officials seem like they have ‘no idea' what is going on with U.S. inflation, strategist says

Federal Reserve officials in the U.S. seem uncertain about the country’s inflation situation, according to Julian Howard, an investment director. Policymakers have shown concerns about high inflation and have been urging patience with interest rate cuts. However, Howard believes that they lack a clear understanding of the situation. He noted that predicting inflation is difficult and that there is a credibility problem with policymakers’ expectations. Despite inflation remaining elevated, Howard mentioned that markets are handling it, partly due to changes in mega-cap stocks. These companies have high cash levels, enabling them to make risk-free profits regardless of interest rates.