Inflation cooled to 3.1% in November.
This is a startling contrast to the inflation peak of 9.1% in June 2022
Loans are much less likely to go on to default as inflation comes down.
Fed chair Jerome Powell casts some doubt on holding rates steady in the coming months, and this should help ease the Fed's mind in keeping the interest rate steady and possibly reaching a turning point.
This could help the economy to proceed into a “soft landing” and allow possible drastic economic recovery in 2024. May even push the S&P to an all-time high next year. Some investors are estimating that the Fed may cut rates before May 2024.
The CPI report, interest rate hikes, house prices and rents, wage growth, job openings, unemployment rate, international conflicts, and trade wars all play a significant role in guiding the market's macroenvironment.
“In November, the Consumer Price Index for All Urban Consumers increased 0.1 percent, seasonally adjusted, and rose 3.1 percent over the last 12 months, not seasonally adjusted. The index for all items less food and energy increased 0.3 percent in November (SA); up 4.0 percent over the year (NSA).”
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