The Fed's microphone: The U.S. economy may have already experienced a soft landing, but no one is willing to declare victory.

"The Fed's Listening Device" In his article, Nick Timiraos pointed out that various key indicators of the U.S. economy are pointing towards the same positive direction: inflation is decreasing, the labor market remains strong, and economic growth is stable. This is not a definitive conclusion, but it is the closest the U.S. economy has ever been to achieving a soft landing. Just four years ago, many economists believed this was not possible. Now, the scenario where the U.S. economy brings down inflation to the Fed's 2% target without falling into a recession, is becoming more credible. However, even though there is no need for an oxygen mask, it is still too early to undo the seatbelt. The Fed's preferred inflation measure, core PCE, is currently close to 3%, and many forecasters expect that inflation will have little progress this year as the price increases related to tariffs spread to more areas. At the same time, the labor market may not be as strong as last week's report indicated. Jeffrey Cleveland, Chief Economist at Payden & Rygel, objectively stated that the labor market has been weak, and it is more likely that the unemployment rate will rise rather than fall this year.