Inflation, however, remains well above the Federal Reserve target of 2%.” While the Fed will likely raise rates this week, it’s not expected to be a large increase similar to last year. Still, “continued increases in interest rates will ultimately slow down the economy and trigger a recession,” adds Sandoval.
Sandoval remains positive, though, “Looking ahead, with the assumption the labor market remains robust, we expect consumer sentiment to improve slowly as inflation pressures continue to ease.”