๐ Will Powell Be Santa and Lower Interest Rate Hike Tomorrow?๐
๐๐๐Hurray! The markets cheered as November CPI report came in lower than expected to 7.1%, down sharply from 7.7% in October.
Consumer prices rose last month at the slowest 12 month pace since December 2021,finishing the year in which inflation hit the highest in 4 decades!
However there is one area of concern and Jerome Powell has highlighted core services inflation excluding housing as potentially "the most important measure" in understanding the potential for future inflation. This important measure of inflation has remained rather high due to continued high wage growth.
Core CPI, which excludes energy and food prices, rose 6% in November from last year, easing from a 6.3% gain in October.
This means that the Feds is on track to increase interest rates by 50 basis point on Wednesday, following a larger increase of 75 basis points at the last 4 FOMC meetings.
The US stock prices jumped and bond yield fell after the release of the CPI report.
As Jerome Powell takes centre stage tomorrow, the markets will be all ears to see what are the Feds' intention on interest rates hikes going forward. It will set the tone and impact the markets in December and in 2023.
Will Jerome Powell Be Santa tomorrow? I believe he will as inflation is slowly but surely coming down. However I remind myself that no matter what the outcome maybe, it is important to focus on my goal of FIRE and think long term. That means having a diversified portfolio of different classes of assets that will generate a solid passive income for the long haul.
@MillionaireTiger @Tiger_chat @CaptainTiger @TigerStars
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