High or low, both inconvenient.

Yesterday, "the Federal Reserve approved a widely expected rate cut and indicated two additional cuts may come before year-end amid growing concerns about the US labor market." The Federal Open Market Committee set rates between 4% and 4.25%. CNBCTV18. The US annual consumer price index (CPI) inflation came in at 2.9% in August, up from 2.7% in July and 2.3% in April 2025. bls.gov. US "Total non-farm payroll employment changed little in August (+22,000) and has shown little change since April, the US Bureau of Labor Statistics (BLS) reported today. The unemployment rate, at 4.3%, also changed little in August." bls.gov. Why cut interest rate if nothing changed? Because, nonfarm payroll employment increased by 256,000 in December 2024 and the unemployment rate was at 4.1%. bls.gov. "India's retail inflation quickened to 2.07% in August from an eight year low of 1.55% in July, driven by fading impact of base effect, according to government data." ET. "India's wholesale prices in August rose 0.52% year-on-year, reversing a 0.58% decline in the previous month." Reuters. However, "Hedge fund manager Akshat Shrivastava...said that while official data pegs India's retail inflation at just 2.07%, the middle class is dealing with a much higher cost of living, with expenses on essentials rising by at least 10%." BT. Which means, "Rs 50 million can last a lifetime in Vietnam or Thailand - but in Mumbai or Delhi, it might barely stretch a few years." BT. But, "Just as inflationary heat is rising again in America, much of Asia is feeling a chill." "Consumer prices have fallen outright in China, the biggest of all, and in Thailand." "Even in inflation-prone India prices rose by just 1.6% in July, the slowest rate since 2017." "One culprit is Chinese overcapacity, which has entrenched deflation domestically." Since 2022, China's export-price index has fallen by 15%, even as exports have risen overall." "Over the same period, China's goods-trade surplus with developing countries in Asia almost doubled." "Expect Trump's tariffs to entrench the low-inflation trend." "Deflation is a decrease in the general price level of goods and services.""When it occurs the value of money grows over time." "Deflation is widely regarded as an economic 'problem' that can intensify a recession or lead to a deflationary spiral." CFI.  "China is seeing a fierce e-commerce war." "It is led by Quick Commerce players," which are "China's version of Blinkit, Swiggy, Zepto." "As a result, China's e-commerce giants, including Alibaba, JD.com and Meituan, are locked in an unprecedented 'instant retail' price war, which they view as crucial for their future despite government warnings. The fierce competition,..has prompted authorities to express concern that the aggressive price-cutting could exacerbate deflationary pressures in an already fragile economy." TOI. Last month, the Reserve Bank of India lowered its inflation projection for FY26 to 3.1% from 3.7%. ET. It may be pleasing that Indian companies are intensifying deflation in China but falling prices could increase imports of Chinese goods, increase our current account deficit, hurt sales of domestic companies, cause higher unemployment and a fall in consumer demand. A kind of deflationary spiral. Higher prices or lower, we have no control. That is the danger. Reuters.