#TrumpordersfederalbanonAnthropicAI BIG WARNING: US ECONOMY IS HEADING TOWARDS STAGFLATION

Just now, US PPI and Core PPI data was released.
US PPI came in at 2.9% vs. 2.6% expected.
US Core PPI came in at 3.6%, its highest level in 11 months.
This is a clear sign that US inflation is heating up again.
But what about GDP?
Well, US Q4 GDP came in at 1.4%, its worst print in 3 quarters.
This means the economy is shrinking while inflation is heating up.
That's what stagflation is, and it's the worst possible thing for an economy.
During such periods, easing monetary policy boosts GDP but makes the inflation situation worse.
The tightening policy brings inflation lower, but GDP gets even worse.
This means the Fed is completely trapped now, and nothing good will happen without breaking the economy first.