Inflation is proving stickier than expected, which could cause Fed to hit pause button on more interest rate cuts.

U.S. stocks were surging on Wednesday morning as Treasury yields fell after core inflation data came in below expectations, boosting bets that the Federal Reserve will still be able to cut interest rates this year.

Stronger-than-expected data on the labor market has added to clues that the economy continues to run at a solid pace, amplifying fears about stubborn inflation.

Recently, progress on inflation appeared to be stuck or, at worst, reversing: A closely watched gauge of underlying price hikes — an index that excludes highly volatile categories — hadn’t budged for months.

The Dow fell 600 points on Friday morning after new job reports surpassed expectations, and the Federal Reserve indicated that interest rate cuts may be postponed. Additionally, inflation remains a concern and is anticipated to stay high.

The Federal Reserve will soon begin its quinquennial review of the monetary policy strategy, tools and communications employed to fulfill its congressional mandate.

U.S. inflation probably worsened last month on the back of higher prices for gas, eggs, and used cars, a trend that could lessen the chance that the Federal Reserve will cut its

December’s retail sales report could be a bright spot for the economy, rounding out a surprisingly solid holiday season. By all accounts, the sales report—due Thursday morning at 8:30 a.m. Eastern—should be a solid one.

The S&P 500 turned positive in late morning trade on hopes that more rate cuts from the Federal Reserve might still on the table for 2025. Fed governor Christopher Waller said he sees potential for up to four more cuts this year,