US: Core PCE inflation to peak at 2.4% in April – Goldman Sachs

The Goldman Sachs analysts believe that the US inflation is likely to edge higher in the coming months before subsiding by the year-end.

Key quotes

Forecast “core PCE inflation to peak at 2.4% in April and then by year-end back to 2.0%, bolstered by the year-on-year comparison to the April 2020 lockdowns.”

“In our baseline, a partial rebound in four particularly sensitive categories-air and ground transportation, hotels, and recreation admissions-will contribute nearly +0.5pp.”

“But how high could core inflation go if mass vaccination unleashes surging demand in virus-sensitive categories?”