The PCE price index, the Fed’s preferred inflation gauge, showed an increase of just 0.1% from October and a 2.4% annual rate – which was below expectations. Excluding food and energy, core PCE also increased 0.1% monthly and was 2.8% higher from a year ago, with both readings being 0.1%Read More →
The Federal Open Market Committee (FOMC) cut its borrowing rate to a range of 4.25% – 4.50%, mirroring its December 2022 level. The Fed indicated that it probably would only lower twice more in 2025, according to the closely watched ‘dot plot’ matrix of individual members’ future rate expectations WhileRead More →
On Tuesday 17th December 2024, the Dow Jones Industrial Average lost 0.61%, completing a nine-day losing streak. The Dow Jones Industrial Average has recently experienced its longest losing streak since the 1970’s – 1978 to be precise. The index has suffered nine consecutive days of declines. This downward trend began on 4th December,Read More →
U.S. consumer prices rose at a faster annual pace in November 2024, a reminder that inflation remains an issue both for households and policymakers. The consumer price index (CPI) showed a 12-month inflation rate of 2.7% after increasing 0.3% on the month, the Bureau of Labor Statistics reported Wednesday 11th November 2024.Read More →
More new records set in extended U.S. post-election rally The S&P 500 and Nasdaq climbed on Thursday 7th November 2024, extending the rally following the victory of President-elect Donald Trump, while traders considered the implications of the Federal Reserve’s recent rate reduction. The S&P 500 rose to close at anRead More →
The Federal Open Market Committee (FOMC) has reduced its benchmark overnight borrowing rate by 0.25%, bringing it to a target range of 4.50%-4.75%. This move follows September’s significant 0.5% cut. The overnight borrowing rate, while primarily affecting interbank lending rates, also typically impacts consumer debt products including mortgages, credit cards,Read More →
Inflation saw a modest rise in September 2024, edging closer to the Federal Reserve’s target, as reported by the Commerce Department on Thursday 31st October 2024. The personal consumption expenditures (PCE) price index recorded a seasonally adjusted increase of 0.2% for the month, and the year-over-year inflation rate stood atRead More →
On Wednesday 23rd October 2024, the U.S. 10-year Treasury yield climbed again as traders considered recent remarks from Federal Reserve officials regarding the direction of interest rate reductions The U.S. 10-year Treasury yield increased by over 0.030% to approximately 4.24%. The benchmark rate peaked at 4.26% during the session, itsRead More →
Recent inflation data suggests that the Federal Reserve is fast approaching its goal, if not already there – following the central bank’s significant interest rate reduction of 0.50% a few weeks ago Both consumer and producer price indexes for September 2024 aligned with forecasts, indicating a decline in inflation towardsRead More →
Federal Reserve Chair Jerome Powell recently stated that the latest half-percent reduction in interest rates should not be interpreted as a sign that future measures will be equally as aggressive. The Fed suggests that subsequent adjustments will likely be more ‘modest’. In his address, the central bank’s chief highlighted theirRead More →
The Federal Open Market Committee (FOMC) has voted to reduce the interest rate by 0.50% after having maintained its benchmark rate within the range of 5.25% to 5.50% since July 2023 The previous rate was the highest seen for 23 years and remained unchanged even though the Fed’s favoured inflationRead More →
As anticipated in the U.S., prices rose in August 2024, while the annual inflation rate fell to its lowest point since February 2021, according to a Labor Department report on Wednesday 11th September 2024. This development likely now paves the way for a Federal Reserve interest rate reduction next weekRead More →
Is the U.S. economy already weaker than the headline data suggests and should the U.S. Federal Reserve already be easing? In the U.S. recent data (Friday 30th August 2024) showed the personal consumption expenditures (PCE) price index, the Federal Reserve’s favored measure of inflation, ticked up 0.2% last month, asRead More →
The Dow Jones Industrial Average (DJIA) reached a new record high on Monday 26th August 2024, closing at 41240. Investors have responded positively to the Federal Reserve’s recent indications that interest rate cuts are highly probable to commence in September 2024. Market dynamics and sentiment The rise of the DJIARead More →
No surprise here then as the Fed have been signalling a cut for some time now The Fed summary stated: “The vast majority” of participants at the July 30-31 meeting “observed that, if the data continued to come in about as expected, it would likely be appropriate to ease policyRead More →
U.S. consumer prices (CPI) increased at the slowest rate in over three years last month, further supporting the argument for the Fed to begin reducing interest rates. According to the U.S. Labor Department, prices climbed 2.9% in the 12 months leading up to July 2024, marking the smallest yearly riseRead More →
Has the Fed over-cooked it this time by waiting too long to reduce interest rates? U.S. stock markets threw a wobbly after the latest employment data and after the Fed delayed its first rate cut… again. September 2024 now looks likely for that first cut – but by how much:Read More →
FOMC hold rates steady at 5.25% – 5.50% Federal Reserve Chair Jerome Powell ended a press conference in which he gave markets exactly what they wanted; a strong indication of a September 2024 rate cut. Powell says September 2024 rate cut ‘on the table’ if inflation continues to cool. FederalRead More →
Gold prices climbed to $2,482 per ounce, hitting an all-time high. Gold prices continued to peak at new record highs Tuesday and Wednesday 15th and 16th July 2024. On Monday 15th July 2024, Powell reportedly said the Fed won’t wait for inflation to reach the central bank’s 2% target before it begins cutting,Read More →
Jerome Powell appears to be further paving the way for a rate cut at the next meeting in July 2024. Federal Reserve Chair Jerome Powell reportedly said Monday 15th July 2024 that the central bank will not wait until inflation hits 2% to cut interest rates. Powell referenced the idea that centralRead More →
Jerome Powell on Tuesday 9th July 2024 reportedly expressed concern that holding interest rates too high for too long could jeopardize economic growth. This comment came ahead of the consumer price index reading due this week. Preparing for a two-day session on Capitol Hill, the central bank chief stated thatRead More →
The ‘Sahm Rule’ serves as a heuristic indicator employed by the Federal Reserve to ascertain the onset of a recession in the economy. The Sahm Rule is a real-time evaluation tool based on monthly unemployment data from the Bureau of Labor Statistics (BLS). Named after economist Claudia Sahm, it forecastsRead More →
The U.S. economy exceeded job growth expectations in May 2024, alleviating concerns of a labour market downturn but potentially diminishing the Federal Reserve’s motivation to cut interest rates. Non-farm payrolls surged by 272,000 for the month – a significant increase from April’s 165,000 and surpassing the consensus forecast of 190,000.Read More →
Bad economic news appears to have had an interesting impact on the stock market recently. Traditionally, negative economic data might be anticipated to result in falling stock prices; however, recent trends have diverged from this norm. News trend In the past two months, negative economic news has had a paradoxically positiveRead More →
The decision comes as inflation, which measures price rises over a period of time, remains above the Bank’s 2% target at 3.2%. But bank says cuts are coming. Is the 2% target still a sensible benchmark? The 2% inflation target set by central banks has been a widely adopted benchmarkRead More →
The Fed have deliberated over ‘transitory’ inflation – (they got that wrong). They have teased us about when rates will be cut (still waiting). And now we are told no rate cut but: ‘the next rate move is unlikely to be up!’ Probably better to say and do nothing atRead More →