2024-03-12 13:16:00
© Reuters
Investing.com – It was issued in a way that the ships, investors, or the Federal Reserve did not desire, as it came higher than expectations, bringing back to the markets the fear of a climate in which inflation will rebound again despite…
The headline consumer price index in the United States rose on an annual basis for the month of February by 3.2%, higher than expectations and the previous reading, which recorded only 3.1%. While it rose monthly by 0.4%, as experts expected.
At the same time, the annual core consumer price index (without food and energy) for February grew to 3.8%, down from 3.9% in January, and higher than expectations of only 3.7%, while the monthly index rose by 0.4%, equal to expectations.
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How does this affect the Fed’s position?
These data contribute to strengthening the Federal Reserve’s fearful position of reducing interest during the first quarter of 2024, as Jerome Powell, Chairman of the US Federal Reserve, said during his testimony before Congress that came last week, that all members of the Federal Reserve Committee do not believe that the time is appropriate to reduce interest and that they They rely on data, especially inflation data, to determine their position and timing of interest cuts.
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Why is inflation accelerating again?
Analysts expressed their concern about the rise in the consumer price index, especially the core, and its failure to slow down for the second month in a row, explaining that the repeated steadfastness at the level of 3.9% – 3.8% indicates that this behavior may be repeated again and return to higher levels.
The Bureau of Labor Statistics reported that the core inflation rate moved higher due to expenditures in real estate, travel, vehicle insurance, clothing, and leisure activities.
On the other hand, investors have not changed their expectations for the timing of the Fed’s interest rate cut, as investors cling to a 60% majority, according to data from the Fed’s follow-up tool provided by Investing, that the Fed will make its first interest rate cut in 2024 at the June 2024 meeting. This expectation has not changed since Data for last month.
Market prices now
The US dollar rose 0.22% to 102.692 against a basket of foreign currencies, with some expecting interest rates to remain high for a longer period. While gold continued to fall, the price fell by 0.83% to $2170.4 per ounce, and the price fell to 2165.1, a fall of 0.8%.
Yields are currently rising, and 10-year Treasury bond yields rose 0.7% to 4.136%.
The currency is still trading above the historic $72,000 level, and Bitcoin is now recording $72,213 per coin amid a decline from altcoins.
It fell by 0.11% to 0.41%, while Dow Jones maintained its rise by 0.12% so far.
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