7 replies to this topic

[Rogerdodger]

Breaking news from Rosanna Rosanna Danna!

"Nevermind"

Inflation at 3.1% Reflects Stubborn Pricing Pressure, Clouding Outlook for Fed Rate Cuts

Inflation cooled again in January but came in above Wall Street’s expectations, another sign that the Federal Reserve’s path to interest-rate cuts is far from settled.

The Labor Department reported Tuesday that consumer prices rose 3.1% in January from a year earlier, versus a December gain of 3.4%. That marked the lowest reading since June.

Still, the consumer-price index was higher than the predicted 2.9%, a disappointment for investors who hope the Fed will cut rates sooner rather than later.

Stocks fell and bond yields rose after the release. Interest-rate futures, which before Tuesday’s report implied the central bank would probably begin cutting rates by its May meeting, now suggest a June start date is more likely.

 

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[Rogerdodger]

Today the U.S. Bureau of Labor Statistics released the consumer price index report for January.

“The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.3 percent in January on a seasonally adjusted basis, after rising 0.2 percent in December, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 3.1 percent before seasonal adjustment”.

The index for shelter increased by 0.6% in January, which contributed the largest spike in inflationary pressures, contributing approximately two-thirds of the monthly all items increase. Food was also troublesome, increasing 0.4% last month. The energy index fell by 0.9% over the month, largely due to a decline in gasoline costs.

The numbers revealed that inflationary pressures last month came in 1/10 of a point more than economists’ expectations. A higher-than-expected rise in inflation last month could easily change the timing of rate cuts by the Federal Reserve. More so, it raises a small, but real possibility that the Federal Reserve might raise rates before pivoting to rate cuts. However, for that to happen, inflation would have to come in hotter than expected in February.

[Douglas]

You think you got it rough, be grateful.  I live in the UK where a 4% "official" inflation figure was just released.  Yesterday paid the equivalent of $50 for a simple lunch for two at a café here in Bath which included no booze.  My electric utility rate just rose to about $0.36/kWhr.    The only saving grace is that I can sell my used car which I bought two years ago for about the same thing that I paid for it.  Never seen that before.  Elections here like US later in the year,  I expect a lot of angry voters will go to the polls.

 

Regards,

Douglas

[qqqqtrdr]

I look around and see inflation heating up in different areas.    I agree we need to go down to 2%, but it looks like we will be starting a new housing boom of sorts which will increase rates or keep it the same.

[linrom1]

  Elections here like US later in the year,  I expect a lot of angry voters will go to the polls.

 

Regards,

Douglas

So does it mean that they elect ayatollahs to rule England like they do in Scotland, Ireland and Wales?

[Douglas]

linrom1, the bad UK economics does augur well for the out-of-power Labour party here in the UK currently lead by Keir Starmer who is an atheist.  The current Tory prime minister, of course, is Rishi Sunak, who is a Hindu, not Muslim.  Rishi is a UK variety conservative which is closer to a US Democrat than a Republican.  

 

Regards,

Douglas

Edited by Douglas, 14 February 2024 - 01:47 PM.

[pdx5]

Inflation is the result of many factors, but predominantly it is from excessive money printing (to finance budget deficits) and growing affluence in Asian countries who now compete for higher class of foods, services and goods with western countries. 

[steadyquest]

It appears that the fed may not need to raise rates - they have been rising of their own accord for the past month.

The market should embrace higher inflation, because that's the driver of profit and GDP growth.  If the insane deficit spending stops translating into inflation, the market should be concerned, because that could indicate our stimulus-rigged economy is faltering.

Inflation = higher prices = higher market.

OT - I wonder if/when INTC will recover its historical position in the semi space.

 

I think NVDA is gonna hit the top of the channel before seeing a significant correction. .