Inflation is one of the key reason behind the marlet sell-down since Jan 2022. Crude oil which is the #1 factor behind inflation has stabilized around USD80+/barrel. The property market in US have also witnessed a significant drop in transaction volume due to rising interest rates. Furthermore, other factors such as corn, wheat prices have fallen back to pre- Russia-Ukraine war prices.
The released Aug inflation data is 8.2%, hence inflation has likely peaked in June! Although the drop in inflation is not huge, there's good sign that it is gradually slowing down.
Everyone is expecting a 75 basis point interest hike during 20- 21 September meeting. Will there be a surprise 100 basis point interest hike??
After which, the million dollar question is when will the Fed slow down on the interest hikes?? Meanwhile, this can be a great opportunity to go bargain hunting for good stocks! It is also good to buy some put options and perform some short-selling using inverse ETF to protect your portfolio during the panic selling.
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