Persistently high inflation and Trump's tariffs keep Fed from adjusting rates

US inflation remains at levels that concern Federal Reserve (Fed) officials. At the same time, President Donald Trump's administration continues to impose import tariffs, which could support high price pressures.

According to a Bloomberg survey, Friday's data will show that the US core personal consumption expenditures price index rose 0.3% in February for the second consecutive month, accelerating to 2.7% year-on-year. At the same time, income growth slowed to 0.4%, as expected by economists surveyed by the agency.

Rising prices for goods and some services in the United States offset declines in other sectors, respondents said. The persistently high inflation and expenditures could justify the Fed's decision to keep interest rates at current levels in March.

Friday's data will provide insight into price pressures and economic activity in the US ahead of Trump's announcement of new tariffs on April 2. As Fed Chairman Jerome Powell noted, the regulator's officials have the option of keeping rates unchanged in order to better assess the impact of the administration's policies on the nation's economy. Friday will also see the release of the March consumer sentiment survey results.