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US Inflation Moderates: Fed Faces Dilemma Amid Mixed Data
2024-09-12 05:50:08
Economy
Inflation
Markets

US Inflation Moderates: Fed Faces Dilemma Amid Mixed Data

US inflation hit a 3-year low in August, leading to uncertainty over Fed's interest rate decisions. Despite lower energy prices, the consumer price index dropped.

Core inflation remains stable, prompting caution from the Federal Reserve. Investors are torn between hopes for rate cuts and concerns over rising core inflation.

Market volatility ensues, with stocks falling and Treasury yields rising. The upcoming Fed meeting could shed light on the central bank's stance on monetary policy adjustments amidst economic uncertainties.

Related news on that topic:

U.S. Core Inflation Rose 0.3% in August, Leading to Rate Cut ... Cut Speculation

U.S. core inflation rose 0.3% in August, faster than expected, likely leading to a 25 basis point Fed rate cut next week. CPI rose 2.5% year-over-year, while core CPI was 3.2%. Expectations for the Fed to cut rates by 25 basis points next week jumped to 85%. The dollar index rose 0.15% and gold price dipped 0.45%. Bitcoin, U.S. stocks, and Treasury yields fell following the report. The consumer price index for August increased by 0.2%, while core inflation remained steady at 3.2%. The Federal Reserve may exercise patience in lowering borrowing costs due to the steady core prices. The inflation rate in the U.S. dropped to 2.5% in August, its lowest since 2021, with the gas and food prices being contained. However, the underlying inflation rate remains at 3.2%, indicating ongoing efforts to control prices. The report matched economists' expectations, but the market reaction was mixed. US stock futures fell as investors assessed August inflation data, with core prices rising more than expected, reducing odds of a 50 basis points Fed rate cut. Bitcoin prices may drop by up to 20% if the Fed cuts interest rates, according to Bitfinex analysts.

US Inflation Softens Significantly as Fed Considers Interest Rate ... Cut

US inflation has eased to its lowest level since February 2021, prompting the Federal Reserve to potentially cut interest rates. With the consumer price index rising by 2.5% annually and core CPI increasing by 0.3% monthly, the US economy faces vital decisions ahead, especially regarding the cost of living, which has become a crucial election issue. Despite the recent peak of 9.1% inflation in June 2022 and the Federal Reserve's significant policy changes, aiming for a 'soft landing', signs of an economic slowdown are emerging. Furthermore, the easing inflation, highlighted by the August CPI data, could lead to potential Federal Reserve rate cuts, potentially benefiting cryptocurrencies amidst a shifting economic landscape.

Read 23 more recent news on this topic

The press radar on this topic:

The Street
12. September 2024 um 21:51

Stock Market Today: Stocks lower with key inflation report on deck TheStreet Daily Newsletter

Finance
Economy
Politics
U.S. equity futures declined ahead of key August inflation report before Fed meeting. Report expected to show lower headline, steady core inflation. Investors also eyed presidential debate, stock moves like Truth Social and Buffett's BofA sales, as well as falling Treasury yields and upcoming 10-year auction.
The Street
13. September 2024 um 10:22

CPI inflation report pumps the brakes on big Fed rate cut bets TheStreet Daily Newsletter

Economy
Finance
U.S. inflation eases, but core prices steady, hinting at Federal Reserve patience in lowering borrowing costs. Consumer Price Index for August at 2.5%, down from 2.9% in June. Core inflation remains at 3.2%, lowest in three years. Stocks drop, Treasury yields rise. Fed likely to cut rates in Washington.
Yahoo Finance
11. September 2024 um 12:35

Inflation: Consumer price increases hit lowest annual inflation rate since early 2021

Economy
Politics
Finance
US inflation hit a 3-year low in August; Federal Reserve faces decision on interest rate cuts; core inflation, shelter index, and rent/OER remain sticky; energy index decreased, food index increased, other indexes saw notable changes; report matched economists' expectations, but market reaction was mixed.
Yahoo Finance
12. September 2024 um 01:31

Here's why the stock market is throwing a tantrum about new inflation data

Finance
Economy
The stock market reacted negatively to mixed inflation data, with the Dow dropping 600 points. The consumer price index showed lower headline inflation, but core inflation rose more than expected, dashing hopes for a 50 basis-point rate cut by the Fed. The Fed's dual mandate, labor market, and housing costs are key factors, with a Morningstar economist noting that shelter inflation must inevitably fall. Investors are still pricing in significant rate cuts by the Fed, and the Independent Advisor..
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