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Inflation Cools in June, Paving the Way for Potential Fed Rate ...
2024-07-11 14:39:20
Economy
Finance
Stocks

Inflation Cools in June, Paving the Way for Potential Fed Rate Cut

The latest U.S. inflation data for June showed a notable easing of price pressures, with consumer prices unexpectedly falling. The Consumer Price Index (CPI) declined 0.1% from May, marking the first monthly decline since May 2020. The annual inflation rate also slowed to 3.0%, down from 3.3% in May.

This cooling of inflation has increased market expectations of a potential interest rate cut by the Federal Reserve, with the odds rising to over 70%. The data is viewed as positive for equities, with U.S. stock futures paring declines after the release.

Investors are closely watching the stock market's performance and adjusting their strategies accordingly, as they anticipate the start of the second quarter earnings season. Additionally, the prospect of a rate cut cycle and increased prospects of interest-rate cuts are likely to benefit risk assets, including Bitcoin, helping the leading cryptocurrency extend its recent price recovery.

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The stock market is on an upward trajectory, with the S&P 500 and Nasdaq Composite reaching record highs as investors monitor a potential pullback. Federal Reserve Chair Jerome Powell's semiannual testimony to Congress is eagerly anticipated for insights on the economy and inflation. Although concerns about a 10% correction linger, the market rally, driven by AI-linked stocks and big tech surges, persists. Analysts are reassessing S&P 500 targets amidst a backdrop of strong corporate earnings and hopes for interest rate cuts. Powell's statements hinting at rate cuts have boosted Wall Street optimism, despite the need for continued 'good data' to solidify confidence.

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Read 12 more recent news on this topic

The press radar on this topic:

New York Times - Business
12. Juli 2024 um 00:26

Fresh Inflation Data Are Expected to Show Continued Cooling

Economy
Finance
Politics
The upcoming Consumer Price Index data is expected to show continued cooling of inflation, with overall inflation likely at 3.1% in June, down from 3.3% in May. Core inflation, which excludes food and fuel prices, is expected to remain unchanged at 3.4% year-over-year. This moderate inflation data could provide evidence that the Federal Reserve has successfully wrestled rapid inflation under control, as they contemplate when to begin cutting interest rates.
Yahoo Finance
11. Juli 2024 um 10:23

Futures edge lower ahead of rally-testing inflation data

Finance
Economy
Technology
Wall Street futures slipped ahead of the release of key U.S. inflation data, which could bolster expectations of policy easing from the Federal Reserve and keep equities on their record-breaking run. Traders are pricing in a 68% chance of a 25-basis-point rate cut by September, up significantly from a month ago. The S&P 500 and Nasdaq reached new highs on Wednesday, boosted by gains in heavily weighted stocks and semiconductor companies.
The Street
15. Juli 2024 um 10:38

Stock Market Today: Stocks dip with inflation on deck, Costco leaps TheStreet Daily Newsletter

Finance
Economy
U.S. equity futures slipped lower as investors braced for a key inflation reading and the start of the second quarter earnings season. The S&P 500 and Nasdaq extended their winning streaks, with the S&P 500 closing above the 5,600 point mark for the first time on record. Costco shares jumped 3.1% after posting solid June sales and lifting its membership fees, while Delta Air Lines shares slumped 6.3% after posting weaker-than-expected earnings.
Inc.com
11. Juli 2024 um 11:45

Economists Aren't Great at Forecasting Inflation

Economy
Finance
Politics
Economists expect the June Consumer Price Index report to show a third month of cooling inflation, with a median estimate of 3.1% year-over-year. However, history shows that economists often struggle to accurately forecast inflation, with CPI coming in hotter than expected more often than cooler. Consumers also remain skeptical that the Fed will be able to bring inflation down to its 2% target, and Fed Chair Jerome Powell has indicated that the central bank may not wait until inflation reaches..
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