Inflation in the US economy expected to rise

03/25/04 - Morgan Stanley

NEW YORK, March 25 (New Ratings) - Analysts at Morgan Stanley believe that inflation in the US economy has bottomed and is likely to rise over the next few months.

In a research note dated March 22 and published this morning, the analysts mention that the prices of core consumer goods have risen over the last three months on account of an improving demand/supply balance. Healthy global demand, restricted supply and the sluggish US dollar have been driving the prices of non-energy commodities over the last one year, the analysts add. Imports in the US are now more expensive, given the sharp decline in the US dollar, Morgan Stanley points out. The price of services is still flat, the analysts say.