Inflation is slowing down opening the possibility of FED rate cuts

vlemon in #hive-167922 • 6 months ago

hi HODLers, Hiveans and Lions,

Today was an important day with the inflation data (CPI) released for May and just after, FOMC with J.Powell sharing his views on rates and the economy.

CPI was good as it came just a little bit lower than expected thanks to lower gas and car insurance prices while shelter (rent) remained quite inflationary.

This means that as inflation is cooling, the FED might be able to intervene to help out the economy and boost the stock and crypto markets at the same time!

Source

Stay safe out there,

Posted Using InLeo Alpha

#economy #us #crypto #news #bitcoin #pob #ctp #waivio

6 months ago in #hive-167922 by vlemon

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stefano.massari 6 months ago

In Italy too, inflation seems to be slowing down. According to some data, inflation in Italy is at +0.8% on an annual basis. The national consumer price index remains stable compared to the previous month, while underlying inflation decreases

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vlemon 6 months ago

Thanks for the insight. This is a feeling I have shared over the past 3-4 months.
Today’s US PPI data is even confirming this trend. This could show an overall consumer weakness so let’s beware!

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crrdlx 6 months ago

The most recent CPI had inflation at 3.3%. I don't see why people are calling that "cooling" or view that as a good thing. This is still above the "target" of 2% (which is debatable in its own right), is year-over-year meaning 12 months ago, after increasing considerably 12 months prior to that, it's STILL increasing at a high rate. I prefer the comparisons to now vs just prior to covid. Thise percentages are very very high.

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vlemon 6 months ago

I completely agree with you that it is too high and way higher than 2% but first of all, it seems like the FED is more into the 2%ish camp than the under 2% one. And just with base effects, we should be udner 2% soon enough if it does not pick back up.

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crrdlx 6 months ago

Two things, the Fed us definitely in the 2% camp. They do not want a flat rate. I don't have any faith that inflation will be under 2%, why would it? Interest rates have been much higher in previous years and it seems they're champing at the bit to reduce them at first chance possible. Plus, I don't see any changes in fiscal policy (no reducction in spending). We'll see.

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borsengelaber 6 months ago

My bet is one rate cut this year in fall. More most probably next year.

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vlemon 6 months ago

Yup, I am with you on that one. Job market is slowing significantly though. According to the latest data from small businesses.

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vlemon 6 months ago

Thanks!

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