With US inflation showing a clear slowdown, the market’s attention is focused on the mouth of US Federal Reserve ( Fed ) Chairman Jerome Powell, scheduled for the 14th (local time) . The US consumer price index ( CPI ) increase rate announced on the 13th was 7.1 %, lower than the market expectation ( 7.3 %). The Fed’s Federal Open Market Committee ( FOMC ) regular meeting, which determines monetary policy, announces the rate of increase in the US base rate at 4:00 am on the 15th , Korean time . In addition, a ‘dot plot’ showing the US economic outlook and the level of interest rates at the end of next year that FOMC members each think will be released. The market is making a big step (a 0.5 percentage point increase in the base rate) by the Federal Reserve on the same day, and the US base rate will jump from the current 3.75-4.0 % to 4.25-4.5 %. The point of interest is the dot plot. In the meantime, even though US inflation seemed to be under control, 11
As the monthly producer prices and the number of new hires exceeded market expectations, the observation that a big step would be taken twice in a row by February of next year was slightly more dominant. However , as the 안전놀이터 CPI growth rate fell short of market expectations in November as well as in October , the prevailing view is that the Fed may stop raising the benchmark rate after the big step in December and the baby step in February next year. David Kelly , head of global strategy at JP Morgan, said, “The decline in energy prices ( -1.6 % from the previous month ) has helped to contain inflation, and we can see that service prices are also cooling. But I expect it to rise by 0.25 percentage points in February and stop there.” That means the Fed will raise its final rate to 4.5% to 4.75 % , just short of 5%, and then stop. Anita Markoaska, chief economist at Jeffreys, an investment firm, also told the Wall Street Journal ( WSJ ), “We originally expected to raise 0.5 percentage points twice in a row until February, but as the trend of slowing inflation became clear, in February
We expect a 0.25 percentage point increase,” he said.
Even within the Fed, it is known that the ‘pigeon wave (moderate tightening)’ and the ‘hawkish wave (high-intensity tightening)’ are fiercely fighting over how far, how long, and how long the base rate will be raised.
On this day, on the New York Stock Exchange, index futures surged all at once immediately after the announcement of the US CPI at 8:30 am on the 13th . Nasdaq index futures soared nearly 4%. However, the market opened and the range of increase decreased, and the Dow Jones Index rose by 0.3 % compared to the battlefield, and the Standard & Poor’s ( S&P ) 500 Index, which is centered on large caps, rose by 0.73 %. The tech-heavy Nasdaq index jumped 1.01 %. It is an evaluation that many investors withheld judgment after Chairman Powell’s press conference. On this day, government bond yields fell all at once, but the dollar index, which represents the value of the dollar against the currencies of the six countries, showed a mixed trend, with a large drop and a slight rise.