The US economy is tightening
The US economy is experiencing tight monetary policy, with financial conditions tightening and predicting below-trend growth. The housing sector is showing signs of recovery, but further signs of above-trend growth could threaten inflation progress and require monetary policy tightening. Labor market rebalancing has persisted for a year, with stronger participation among 25-54-year-olds and increased immigration…
What sector caused the most impact on inflation?
Tighter monetary policy and delayed unwinding of supply and demand dislocations have lowered core goods inflation, particularly for durable goods like motor vehicles. The pandemic has led to a decrease in vehicle supply and increased interest rates, resulting in a significant drop in inflation. Core goods prices have declined in the past two months, but…
Products, housing, and non-housing services will be core of PCE inflation
The Federal Reserve Chair Jerome Powell will speak at the “Inflation: Progress and the Path Ahead” conference at Jackson Hole on Friday. He will emphasize the Fed’s commitment to driving inflation down to its 2% goal, despite tightening policy in the past year. Powell will evaluate progress and highlight the outlook and uncertainties faced as…
The Fed’s will keep rates in restrictive territory until inflation reach 2%
Politicians are doubling their efforts to lower inflation to the Fed’s 2% target, with officials lifting their benchmark rate from 5.25% to 5.5% last month. The key is how long they keep them restrictive and how the economy does. Economic output and consumer spending have been high, suggesting the economy may not be cooling as…
Powell’s focus on restoring price stability
Federal Reserve Chair Jerome Powell announced that the Fed will raise interest rates and maintain high borrowing costs until inflation reaches 2%. Although inflation has decreased, it remains too high. Powell welcomed slower price growth in the US economy due to tighter monetary policy and looser supply limitations. He warned that the process still has…
Powell speech has risen interest rate more
The Federal Reserve’s policy rate futures have slightly increased the likelihood of tightening at the November and December policy meetings, following Chair Jerome Powell’s speech. The Fed is expected to maintain rates during the Sept. 19-20 meeting. Powell said the central bank will proceed cautiously as it decides whether to tighten further, but has not…
The Bank of Korea hasn’t raised interest rates since January
South Korea’s central bank’s governor has moderated his aggressive approach amid weaker inflation and sluggish GDP. The seven-member monetary policy board unanimously opted to maintain the base rate at 3.50%, as predicted. The BOK maintained its 1.4% economic growth projection from May but trimmed next year’s to 2.2% from 2.3%. Inflation forecasts remained unchanged in…
Oil price has slipped due to rising supply
Oil prices fell in thin summer trading due to rising supply and a faltering economy. West Texas Intermediate futures fluctuated 2% below $79 a barrel, with open interest near January lows. The US Oil Fund ETF experienced its worst daily outflow since 2020, with nearly $180 million removed from one of the market’s largest exchange-traded…