The Dow has now gained for the past three weeks, its longest weekly winning streak of the year. How long will this rally last?
The Fed is likely to raise rates by another 0.75% in November, Fed members are debating whether to signal that a smaller hike could be in the cards in December.
Reuters reported the U.S. central bank should avoid putting the economy into an "unforced downturn" by raising interest rates too sharply, and it's time to start talking about slowing the pace of the hikes in borrowing costs, San Francisco Federal Reserve President Mary Daly said on Friday.
Make no mistake, a smaller hike does not mean interest rates are coming down at all. At the moment, unlike U.K, at least U.S. CPI not breaking new high is bringing some comfort there:
• May 8.5%
• Jun 9%
• Jul 8.4%
• Aug 8.2%
• Sep 8.2%
We are still at the mercy of month-to-month inflationary data.
The real danger will be with the continuous rise in interest rates and yet the dollar starts weakening, just like the pound. Not happening now, I am keeping watch on this closely. However, it is not all bad news…
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