This Week In The Economy: US January CPI Reinforces Fed’s Cautious Approach, Retail Sales Slump, Japan And UK In Recession

Welcome to a regular snapshot review of U.S. and international economic news that aims to 1) provide a window into the challenges and decisions facing businesses today, 2) determine the direction of economic policy — such as the speed at which central banks decide to raise interest rates, and 3) assess what the impact will be for consumers.

U.S. January CPI Data Supports Federal Reserve Cautious Approach to Monetary Policy

The jump in U.S. consumer prices in January — even if it does turn out to be a one-off — gave further credence to the caution preached by Federal Reserve officials, who have argued that a lot of evidence will be needed to determine if the central bank’s high interest rate policy has successfully gotten inflation on a downward path back to 2%.

The Bureau of Labor Statistics reported this week that the Consumer Price Index increased by 0.3%, following a 0.2% uptick in December, and jumped 0.4%…