Key Inflation Reports to Influence Fed’s Rate Cut Decision
The Federal Reserve will receive its final Inflation data this week before deciding on a potential interest rate cut. The Labor Department will release the consumer price index and producer price index reports for August. The Fed is likely to cut rates at its upcoming policy meeting, with the only question being the magnitude of the cut. The CPI is expected to increase by 0.2%, with an annual Inflation rate of 2.6%. PPI is also projected to rise by 0.2%. While CPI readings are below the Fed’s 2% target, policymakers are more concerned about the trend of Inflation rather than the absolute value. The focus has shifted to the labor market, with hiring slowing down in recent months. The Fed is expected to start rolling back rates, with markets anticipating a quarter percentage point reduction. Some economists believe that the slowdown in hiring may warrant more aggressive rate cuts in the future. Market pricing indicates a possible half-point reduction in November and December.
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Lucas Bennett, completed his Finance degree at Bocconi University in Italy in 2018. He is highly skilled in corporate finance and risk management, beginning his career at a hedge fund in Milan. Lucas expertise extends to consulting for leading European firms, particularly within the energy markets sector. His analytical skills and strategic mindset have made him a sought-after consultant, and he continues to explore new opportunities within the financial services industry across Europe.