Saturday Night Quarterback (on a Sunday) says, For the week ahead expect…
Look for big news on inflation and earnings this week. But I think the news is baked into stock prices so I don’t expect much of a move on the news.
Look for big news on inflation and earnings this week. But I think the news is baked into stock prices so I don’t expect much of a move on the news.
I expect that all eyes will be on the July CPI inflation (Consumer Price Index) report due on Wednesday, August 10, before the market open. The market hope is that we’ll see the first signs that inflation has peaked after the headline CPI inflation surged at a 9.1% annual rate in June.
It’s not the kind of historical comparison you want to hear. Inflation, as measured by the Consumer Price Index (CPI rose at a 9.1% annual rate in June. That was the highest annual rate since November 1981. (Just as the Volcker Fed was raising interest rates to 14% to finally break inflation.) Economists had been expecting inflation of 8.8%. Which would still have been an increase from May’s 8.6% headline rate.
Economists surveyed by Reuters are projecting that inflation, as measured by the Consumer Price Index (CPI), will climb to 8.4% year over year for March against an 8% rate in February when data is released tomorrow before the open of the U.S. stock market.
CPI inflation climbed at a 7.5% annual rate in January, the Bureau of Labor Statistics reported this morning. That was above the 7.3% expected by economists surveyed by Bloomberg and a big jump from the 7.0% annual rate reported in December. The inflation number just about guarantees that the Federal Reserve will raise its short-term benchmark interest rates at its March 16 meeting from the current 0% to 0.25% range.
The big news out of Federal Reserve Chair Jerome Powell’s told Congress appearance before the Senate today (President Joe Biden has nominated him for another term as head of the Fed) was that if inflation doesn’t come down, the Fed would more aggressively raise interest rates.“If we see inflation persisting at high levels, longer than expected, if we have to raise interest rates more over time, then we will,” Powell said in a Senate Banking Committee hearing. Yep, the Fed will fight inflation. “Dog bites man.” Film at 11.
Economists expect the Consumer Price Index (CPI) to have edged lower in August in tomorrow morning’s report.
After a worrying 0.5% jump in January, headline inflation as measured by the Consumer Price Index increased by just 02.% in February. That was right on the 0.2% mark expected by economists surveyed by Briefing.com. Core inflation, which excludes more volatile food and energy priced, rose 0.2% in February, again right at economist projections, after a 0.3% rise in January.