1. White House Advisor Predicts Inflation Will Move Back Toward Target in 2024
2. Consumer Confidence Drops Due to Gas Price Worries
3. Higher Employment Costs Raise Doubts on Inflation Progress
4. Home Prices Continue to Rise in February

The White House advisor, Jared Bernstein, predicts that inflation will gradually move back towards the 2% target in 2024. He mentioned that the forces that brought inflation down in 2023 are still in play, and price pressures are expected to cool off later this year after surging in early 2024. Bernstein highlighted the “unsnarling” of supply chains as a major factor in the disinflationary trend of 2023.

Additionally, Bernstein emphasized the strength of the economy, noting that unemployment is likely to remain low and wages are aligning with lower inflationary trends. However, he cautioned that the path back to the inflation target will be bumpy and nonlinear.

On the other hand, consumer confidence has dropped for the third consecutive month due to concerns about high gas prices stoking inflation worries. The Consumer Confidence Index declined in April, with consumers expressing more pessimism about the current labor market situation and future business conditions.

Furthermore, higher employment costs in the first quarter of 2024 have raised doubts about the progress on inflation. Total wages and benefits for employees rose more than expected, posing a challenge for Federal Reserve officials trying to bring inflation down to around 2.7%. The report on compensation showed that higher wages could impact inflation as businesses may raise prices to cover the increased employment costs.

Lastly, home prices continued to rise in February, reaching a record high due to the “lock-in effect” caused by high mortgage rates. The S&P CoreLogic Case-Shiller Home Price Index rose 6.4% over the last 12 months, the largest annual increase since November 2022. Despite high mortgage rates and costs, home prices are on the rise, exacerbating the existing housing shortage.

Overall, the economic landscape is complex, with various factors influencing inflation, consumer confidence, employment costs, and home prices. The road to achieving the 2% inflation target and addressing economic challenges will require careful navigation and monitoring by policymakers and economists.