Gordon Johnson of the Wall Street analyst firm GJL Research had few words of comfort for his followers and even fewer of praise for the Federal Reserve once the February import prices data came out on March 25.
Specifically, figures showed that import prices in the second month of 2026 rose by 1.3% and export prices by 1.5%, while the expected change for both was at 0.6%. Johnson took particular note of the fact that the increase covers the period before the start of the Iran war, implying dread about how the March numbers might look given the oil prices.
Furthermore, the GJL Research expert extrapolated that, when annualized, the February data hints at an inflation rate between 16.8% and 19.6%. For comparison, the inflationary wave that followed the COVID-19 pandemic never crossed far above 8%, with said record being set in 2022.
Additionally, the highest annual inflation the U.S. faced since 1960 was recorded at 13.5% in 1980, per the 64-year data Finbold retrieved from the Federal Reserve Bank of St. Louis (FRED) on March 26, 2026.
U.S. inflation chart for the period between 1960 and 2024. Source: FREDWall Street expert urges Fed to increase interest rates ‘now’
Elsewhere, Gordon Johnson opined that the singular remedy for the situation would be ‘hundreds of basis points of hikes,’ and emphasized urgency by stating such a move would have to be made immediately, implying the Fed should not wait for the next scheduled meeting.
Perhaps even more alarmingly, the Wall Street analyst concluded that America’s central bank ‘isn’t behind the curve,’ but that it is, rather, ‘not even on the field.’ He also noted that ‘this ends badly,’ referring to both the confirmed February figures and the anticipated March numbers.
Notably, Gordon Johnson’s reading of the situation in the U.S. economy mirrors almost exactly the reaction offered by the top economist Peter Schiff.
Indeed, Schiff, in an X post published at a similar time, similarly opined that the figures are exceptionally alarming and warned that, barring an immediate interest rate hike amounting to several hundred basis points, the U.S. is ‘headed for a full-blown financial crisis.’
Are further interest rate hikes in 2026 likely?
Interestingly, the reactions of the Wall Street analyst and the economist are, in essence, a twisted mirror image of President Donald Trump’s previously expressed desires.
Specifically, since 2026 started, the commander-in-chief repeatedly urged the Fed to address interest rates immediately – as in, not to wait for the scheduled Federal Open Market Committee (FOMC) meetings – though his aim has consistently been to lower interest rates.
Still, no matter the political desires of the various key actors, investors appear to be pricing in further interest rate hikes due to the effects the ongoing Iran war has been having on the global economy.
Featured image via Shutterstock
Source: https://finbold.com/this-ends-badly-wall-street-expert-sounds-alarm-on-19-inflation-risk/
