Economists suggest that heavy-handed immigration policies are contributing to persistent services inflation. By restricting labor supply in immigrant-dependent industries like healthcare and construction, these policies tighten the labor market, leading to higher wage pressures and, consequently, higher consumer prices for services.
An economist created an AI agent that scrapes prediction markets, Wall Street analyst reports, and social media to produce a consolidated, real-time report on recession probabilities. It provides averages, distribution analysis, and corrects for nuances like differing time horizons in market data.
The inflationary impact from the Middle East war will persist well beyond initial gasoline price hikes. Secondary effects on airline fares, diesel fuel, transportation, and agricultural inputs will continue for months, eventually causing an acceleration in core CPI, not just the headline figure.
Data collection gaps from a prior government shutdown forced the BLS to make estimates. A one-time "catch-up" adjustment in the April CPI report will create a technical spike in housing inflation, likely pushing headline numbers higher regardless of real-time market conditions.
Contrary to its long-term deflationary promise, AI is currently fueling inflation. The massive build-out of data centers, demand for computer components, and wealth effects from tech stocks are creating a demand shock that outstrips the technology's nascent productivity gains, pushing prices higher.
The cost of tax preparation services has plummeted by nearly 13% year-over-year. This significant price drop in a service-based industry highlights how AI and automation are already exerting strong deflationary pressure on specific white-collar jobs, a trend that is expected to accelerate.
While March's CPI report showed a decline in used vehicle prices, the Manheim wholesale auction index shows prices are up 6.2% year-over-year. As wholesale prices are a leading indicator, this discrepancy signals that significant consumer-facing price hikes for used cars are imminent.
Moody's Chief Economist developed a "vicious cycle index" that quantifies recession risk based on rapid increases in labor market slack. It captures the self-reinforcing negative loop where rising unemployment spooks consumers, who cut spending, causing businesses to cut payrolls further. This index now signals over a 50% probability of recession.