Central bankers are wary about pivoting to interest rate cuts too early — and the data support that wariness. It's clear from a slew of news on both sides of the Atlantic.

Driving the news: At the World Economic Forum in Davos, European Central Bank president Christine Lagarde tamped down expectations of a rate cut this spring. A day before, Fed governor Christopher Waller in Washington also pushed back against the idea of a near-term rate cut.

• Meanwhile, new U.K. inflation data showed a surprising rebound last month. Stateside, strong December retail sales underscored robust consumer demand.

Why it matters: Financial markets have become increasingly convinced that inflation is defeated and central banks will enter rate-cutting mode imminently.

• Policymakers are not ruling out that possibility but also see two-sided risks. They want more evidence the inflation war is won.

The big picture: U.K. inflation was 4% over the year ended in December, up from 3.9% in November — the first increase in 10 months.

• Meanwhile, U.S. retail sales rose 0.6% in December — a sign of strong consumer momentum heading into 2024 that suggests lingering demand in the economy. It's a key reason the economy has staved off a recession but may also reignite price pressures.

Between the lines: "Resilient consumer spending is at odds with the Fed's wishes and increases the risk that the first rate cut arrives later than investors expect," Nationwide's Oren Klachkin wrote in a note.

What they're saying: Lagarde acknowledged in an interview with Bloomberg that it's "likely" rate cuts could be ahead this summer.

• But she added: "I have to be reserved, because we are also saying that we are data dependent, and that there is still a level of uncertainty and some indicators that are not anchored at the level where we would like to see them."
• Lagarde also said a big risk would be if the ECB cut "too fast and had to come back to more tightening because we would have wasted the effort everyone put in the last 15 months."
• Similarly, Waller said at the Brookings Institution yesterday that "we can see how the data comes in, see if progress is being sustained — the worst thing we can have is it all reverses and we've already started to cut."

The world's second-largest economy is in a different position than much of the rest of the globe: It's trying to stir up demand to blunt slowing growth and falling prices.

• China grew 5.2% last year, the government said — "higher than the 'around 5%' target set at the beginning of last year," Chinese Premier Li Qiang said at the World Economic Forum.

Why it matters: The economy rebounded from the 3% growth in 2022, which came as a result of its zero-COVID policy that stymied the economy.

• But the figure comes as economists warn that China's economy is faltering — with uncertain consequences for the rest of the world.

What to watch: Other economic data shows weakening demand in what has been the world's powerhouse for growth.

• Data out last week showed prices across the Chinese economy continued to fall for the third straight month in December.
• Home prices and property sales also declined rapidly, a sign of the weakening property sector that had once fueled its growth.
• The government also resumed publishing its youth unemployment rate: As of December, the jobless rate for people ages 16-24 was nearly 15% (down from the last published figure of 21% in June).

The bottom line: "The recovery clearly remains shaky," analysts at Capital Economics wrote in a note. "While we still anticipate some near-term boost from policy easing, this is unlikely to prevent a renewed slowdown later this year."

• "Although the government met its 2023 GDP growth target of 'around 5.0%', achieving the same pace of expansion in 2024 will prove a lot more challenging," they added.