This week, the heavyweight US CPI and PPI are coming. In the shadow of tariffs, inflation has become the focus of the market's attention.

Last week, due to the lack of clarity in President Donald Trump's tariff plans, as well as the potential impact of these plans on the overall economy, the US stock market saw a sharp decline. During the week, the S&P 500 index fell by over 3%, the Dow Jones Industrial Average dropped by over 2%, around 1000 points. The Nasdaq Composite index led the decline, dropping nearly 3.5%. The Nasdaq index has fallen more than 10% from its historical high point in December last year, entering a correction zone. In the coming week, key data updates on inflation will be closely watched, including the latest readings of the Producer Price Index (PPI) and Consumer Price Index (CPI), as investors try to find clues on how tariffs might affect future price trends. Data related to inflation expectations and consumer confidence will also be released. In a week where corporate earnings releases are relatively quiet, the earnings reports of Oracle Corporation (ORCL.US) and Adobe (ADBE.US) will be the focus. Fed "not in a rush to act" The February jobs report released on Friday was uneventful. The US labor market added 151,000 jobs that month, slightly below expectations, and the unemployment rate rose slightly to 4.1%. Given other signs of economic slowing, most economists view this report as better than feared. Bank of America Corp's US economist, Shruti Mishra, described the report as "overall a relief." Bloomberg data shows that the market still expects the Fed to cut interest rates three times by 2025. But the lingering question in the market is when the Fed will cut rates again. Fed Chairman Jerome Powell said in a speech on Friday that further rate cuts may not come soon. Powell said, "We do not need to rush, the current situation allows us to wait for the situation to become clearer." With the Fed entering a blackout period before its next meeting on March 18-19, there will be no speeches from Fed officials in the coming week. Price Monitoring The latest data on the rate of price increases will be released on Wednesday. Wall Street economists expect that the February CPI will show an annual inflation rate of 2.9%, lower than January's 3%. According to economists' forecasts, prices are expected to rise by 0.3% month-on-month, lower than the 0.5% increase in January. The "core" CPI, which excludes food and energy prices, is expected to rise by 3.2% in February from the same period last year, lower than January's 3.3%. The monthly core price increase is expected to be 0.3%, lower than the previous month's 0.4%. Sarah House, a senior economist at Wells Fargo & Company, wrote in a report to clients that the February CPI data is expected to only partially reflect the impact of tariffs on inflation data. House wrote, "Although we expect both overall and core inflation rates to decline year-on-year in February, we expect inflation to start to rise in the spring and to remain around 3% for the whole year, despite further easing in housing inflation and increasingly visible consumer fatigue." Not yet a "recession" trade Recent market sell-offs have been driven by weak economic data and concerns about how Trump's tariffs could further weaken the economy. Economists at Morgan Stanley, JPMorgan, and Goldman Sachs Group, Inc. have all lowered their forecasts for US first-quarter or annual GDP. However, it is worth noting that they have not actually predicted a complete economic downturn. At least for now, the more likely scenario is that the US economy will not grow as strongly as many had expected. In fact, there are not many economists talking about an economic recession. For example, with the updated forecast of Goldman Sachs Group, Inc., the probability of an economic recession in the next 12 months has increased from 15% last year to 20%. Companies are not currently worried about an economic recession either. Data from FactSet shows that in earnings conference calls of S&P 500 index component companies this quarter, only 13 companies mentioned the word "recession". This is the fewest mentions of a recession since the first quarter of 2018. This reflects that the recent repricing in the stock market over the past few weeks is largely a readjustment of expectations, as many had originally expected strong performance from the US economy this year. Former White House Council of Economic Advisers Chairman Jason Furman told Yahoo Finance, "I don't think the economy is suddenly turning negative. But all the uncertainties, emotions, and factors are pushing the economy to slow down."