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Investors are excited this week and international stock markets are operating positively. We expect the Personal Consumption Expenditure Index on Friday.
Later in the week, investors will be keeping an eye on the Federal Reserve's preferred inflation gauge, the Personal Consumption Expenditures (PCE) Index, as it could affect the market's mood. If the numbers come in higher than expected, bets on an interest rate cut in the first half of the year could fall apart. This is because the fall in prices may not be as fast as the US central bank would like, leading to a possible reversal in the investor optimism.
With the release of the PCE, markets will be paying attention to the price index and inflation rate, as this data can directly impact the cost of living and Federal Reserve decisions. If the numbers show that inflation is higher than desired or that prices are falling more slowly than expected, expectations of an interest rate cut may dissipate, influencing international stock markets and investments in various sectors.
Inflation hits new record last week
Inflation remains the country's main concern market, with the price index reaching new heights in the last week. The inflation rate has been constantly increasing, directly impacting families' cost of living.
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New inflation indicators are released
On the last Friday, a new inflation indicator, which surprised the market. The Personal Consumption Expenditure Index pointed to a significant increase in prices, leading to expectations of a possible interest rate cut by the Fed.
Market reacts to inflationary pressure
The financial market has been closely monitoring the situation, with investors concerned about the impact of inflation on company profits. Friday's trading session was marked by strong volatility, with the Nasdaq, S & P 500 and Dow Jones wobbling amid inflation concerns.
Sectors impacted by rising inflation
Several sectors of the economy have been affected by rising prices, with emphasis on oil companies, which are facing pressure due to high costs. Oil/Brent and oil/WTI have also been impacted by inflation, raising concerns for investors.
According to him, the current situation requires attention and care on the part of economic authorities, who may consider monetary easing measures to contain the effects of inflation. O Fed director also signaled the possibility of interest rate cuts to stimulate the economy and control inflation.
Source: moneytimes
