Goldman Sachs research suggests that the U.S. may not have as severe an inflation problem as previously thought.

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By breaking down core inflation into different components, the analysis reveals that the U.S. is actually running higher than its pre-pandemic trend, while other countries have normalized.

Factors such as tariffs and AI-related distortions are contributing to the inflation gap.

The News & Observer writes, “That gap matters because it reframes the entire debate. If most of the rest of the world has already normalized while the U.S. sits well above trend, the usual assumption that America’s inflation fight is simply further behind everyone else’s starts to look too simple.”

The study also shows that non-shelter services inflation in the U.S. is lower than in other developed markets, indicating less risk of sustained inflation pressure.

Goldman’s analysis challenges the conventional wisdom about the U.S. inflation situation and suggests that the country may have less of an inflation problem compared to other nations.

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