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Why rates unchanged under high oil prices? Should we blame Fed for high inflation?
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Oil prices are now up over 30% since mid-June. $WTI Crude Oil - main 2311(CLmain)$ reaches $92.43, a record high in 2023. $Brent Last Day Financial - main 2311(BZmain)$ has risen from around $72 to $95. To learn more about oil prices, you can click How to Gain From 25% Upside & 24h Quotes of Oil Futures? But the markets believe the rate hike cycle is over and that Fed will start to cut rates in 2024. data from cmegroup Why do surging oil prices won’t affect rate hike decision? Oil prices account small part for core CPI MORGAN STANLEY: “.. a 10% increase in oil prices .. adds 35bp to headline CPI for 3 months, but just 3bp to core CPI.” The main reason that the market stays positive about rate hike is the core CPI in August drops. And Fed pays attention to core CPI and services inflation other than housing. Market still expects oil prices to be suppressed under the key resistance level of $94. High oil prices won’t necessarily drive Fed to increase rates. The combat against CPI really over? Some investors expect Powell to state “Mission Accomplished“ during FOMC. lol.. meme from WSB Why do we need to combat against inflation? WSB users argue that Fed creation incurs high inflation. $S&P 500(.SPX)$ $NASDAQ(.IXIC)$ meme from WSB Why do surging oil prices won’t affect rate hike estimates? Is the battle against CPI over or not? Should we blame Fed for high inflation? Leave your comments and repost to win tiger coins~ Click to join our topic: Long or short oil at $91? Will market continue to dip amid FOMC decision?
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