El-Erian: Interest rates, inflation moving in right direction, but lower prices 'not going to happen'

Published On Nov 3, 2024, 2:04 PM

Economist Mohamed El-Erian warns that while inflation rates are improving, prices themselves are unlikely to drop significantly. He explains that a decrease in the rate of inflation means prices are still increasing but at a slower pace, and he cautions against expecting former price levels to return. El-Erian suggests that interest rates may continue to decline as inflation stabilizes near the Federal Reserve's target, yet consumer prices in categories like housing and groceries are still high. He emphasizes that failing to manage expectations about inflation could result in economic challenges.