Core prices rose by 0.3% from January to February, thereby falling in line with expectations and decreasing from the 0.5% rise in January compared to the previous month. While Fed Governor Chris Waller stated that a few more months of positive data will be needed to convince the Fed to cut its rates, some economists are confident that the central bank will introduce rate cuts if data continues down this path.

“By the time the Fed meets in June, the data should be convincing enough for them to commence its rate normalization process. But where we sit today, markets need to have the same patience the Fed is exhibiting.” LPL Financial chief economist Jeffrey Roach reflected.

The post PCE Report Could Convince Federal Reserve to Cut Rates in June appeared first on theprimarymarket.com.

The benchmark S&P 500 rose 0.3%, closing at a new record high of 5,241. The tech-heavy Nasdaq Composite ended the session 0.2% higher, while the Dow Jones Industrial Average gained roughly 270 points to approach the 40,000-point mark; a 0.7% increase.

With the next Federal Reserve policy meeting scheduled for six weeks’ time, markets’ focus will shift to other factors in order to dictate the trajectory of stocks. These include developments in AI, which largely drive tech stocks, as well as other economic data including the Consumer Price Index (CPI), Personal Consumption Expenditures (PCE), and the U.S. jobs reports.

The post U.S. Stocks Continue Record Run appeared first on theprimarymarket.com.

This development had a significant effect on investor confidence, driving futures on the benchmark S&P 500 up by 0.4%. Futures on the Nasdaq 100 rose by as much as 0.8%, while contracts listed on the Dow Jones Industrial Average gained 0.3%. Across the Atlantic, the Stoxx Europe 600 advanced by 0.9%, while the MSCI Asia Pacific Index surged 2% higher.

“The Fed appears to have achieved a better balance around its dual mandate of price stability and maximum employment,” Banco Bilbao Vizcaya Argentaria analysts told clients in a written note. They added their expectation that the central bank would normalize its policy stance by June.

The post Fed Sticks to Rate Cut Agenda, Sending Stocks Higher appeared first on theprimarymarket.com.

Fed Chair Jerome Powell revealed that the U.S. central bank appears to be gaining the confidence to introduce interest rate cuts following the release of optimistic economic data. “The Fed may have less confidence on inflation than before, but it still has confidence in the disinflation trend,” Bank of America economists observed.

With attention remaining firmly on the US Federal Reserve, the Bank of Japan is also set to convene this week. It’s largely expected to bring an end to its negative-rate policy on Tuesday. The Bank of England is set to release its own interest rate policy decision later in the week as well.

The post U.S. Stocks Rise Ahead of Fed Rate Decision appeared first on theprimarymarket.com.

Despite consumer prices remaining more sticky than expected, analysts expect that the latest CPI reading will not have a major influence on the Federal Reserve’s monetary policy and the timing of its prospective interest rate cuts. “Things are really where they should be at this point,” Oppenheimer chief investment strategist John Stoltzfus commented, expressing an indifference toward the rise in consumer prices in February.

Both Stoltzfus and chief economist for Manulife Frances Donald agreed that June appears to be a sound time for the U.S. central bank to introduce interest rate cuts. Still, expectations may be pushed back if economic data continues to show significant price increases.

The post Stubborn CPI Reading Unlikely to Affect Fed Rate Cuts appeared first on theprimarymarket.com.

Core PCE is set to come in at 2.8% for the month of January on an annual basis, marginally lower than December’s 2.9% reading. On a month-over-month basis, core PCE is set to be 0.4%, up from a 0.2% rise recorded in December. According to Bank of America, these figures are indicative that annualized inflation numbers may rebound above the Fed’s 2% inflation target.

Given that the Consumer Price Index (CPI) and the Producer Price Index (PPI) for January were hotter than expected, there is a risk that PCE could come out higher than expected, Wilmer Stith, bond portfolio manager for Wilmington Trust observed. “I don’t think they’re going to raise rates,” he said of the Fed’s monetary policy. “[But] maybe the Fed walks it back a little bit to two cuts instead of three.”

The post PCE Inflation Report Threatens to Delay Fed Rate Cuts appeared first on theprimarymarket.com.

This comes as uncertainties rise around the timing of the Federal Reserve’s interest rate cuts. In addition to the Federal Reserve’s actions, it remains uncertain whether inflation will once again rebound, thereby pushing the need for further inflation measures. Initially expected in March, the Fed is now expected by analysts to introduce interest rate cuts around May.

499 billion yuan worth of MLF loans are set to expire this month, with a net 1 billion yuan set to be injected into the Chinese economy as a result of rates remaining constant. The People’s Bank of China’s decision was not a surprising one, with 22 of 31 market watchers polled by Reuters, or 71%, all expecting rates to remain unchanged.

The post China Central Bank Holds Rates Constant appeared first on theprimarymarket.com.

Should this figure ring true, it would show the progress that the Federal Reserve has made in its fight against inflation. Overall CPI is expected to have risen by less than 3% for the first time in almost two years according to economists’ forecasts.

“In deciding when to start cutting rates, the Fed will have to reconcile the data they have in hand— which show inflation on a fast track to the 2% target—with risks that inflation could flare up again or the labor market could weaken more sharply,” Bloomberg Economics noted, adding that a final decision will most likely not be reached until shortly before the next policy meeting.

The post Slowing Inflation Boosts Interest Rate Cut Hopes appeared first on theprimarymarket.com.

“If you’re trying to get the price level back to what it was some years ago, you would really have to just crank down on the economy to do that, so that’s not in our card deck,” Goolsbee admitted during an interview on PBS. When asked about when the Fed could introduce rate cuts, the Chicago Fed president explained that the “weeks and months” of data would be used to determine this rather as opposed to only recent data.

For Goolsbee, Friday’s jobs report was a positive sign, with 353,000 jobs being added over the past month. Still, he warned that the underlying labor market may not be growing as many expect.

The post Federal Reserve Has “Months” of Data to Decide Rate Cut Timings appeared first on theprimarymarket.com.

Ahead of the Fed’s policy decision on Wednesday, markets had been anticipating signs from the central bank regarding the trajectory of its monetary policy going forward into March and beyond. “I don’t think it’s likely that the committee will reach a level of confidence” by the March meeting, Powell admitted during a press conference following the Fed’s two-day policy meeting.

Stocks had already experienced turbulence before Powell’s address following the release of quarterly earnings by several major tech players including Google parent company Alphabet Inc, which suffered a 7% slump in share value, as well as Microsoft and AMD.

The post Stocks Fall as Fed Warns That Rate Cuts Won’t Happen in March appeared first on theprimarymarket.com.

Core prices rose by 0.3% from January to February, thereby falling in line with expectations and decreasing from the 0.5% rise in January compared to the previous month. While Fed Governor Chris Waller stated that a few more months of positive data will be needed to convince the Fed to cut its rates, some economists are confident that the central bank will introduce rate cuts if data continues down this path.

“By the time the Fed meets in June, the data should be convincing enough for them to commence its rate normalization process. But where we sit today, markets need to have the same patience the Fed is exhibiting.” LPL Financial chief economist Jeffrey Roach reflected.

The post PCE Report Could Convince Federal Reserve to Cut Rates in June appeared first on theprimarymarket.com.

The benchmark S&P 500 rose 0.3%, closing at a new record high of 5,241. The tech-heavy Nasdaq Composite ended the session 0.2% higher, while the Dow Jones Industrial Average gained roughly 270 points to approach the 40,000-point mark; a 0.7% increase.

With the next Federal Reserve policy meeting scheduled for six weeks’ time, markets’ focus will shift to other factors in order to dictate the trajectory of stocks. These include developments in AI, which largely drive tech stocks, as well as other economic data including the Consumer Price Index (CPI), Personal Consumption Expenditures (PCE), and the U.S. jobs reports.

The post U.S. Stocks Continue Record Run appeared first on theprimarymarket.com.

This development had a significant effect on investor confidence, driving futures on the benchmark S&P 500 up by 0.4%. Futures on the Nasdaq 100 rose by as much as 0.8%, while contracts listed on the Dow Jones Industrial Average gained 0.3%. Across the Atlantic, the Stoxx Europe 600 advanced by 0.9%, while the MSCI Asia Pacific Index surged 2% higher.

“The Fed appears to have achieved a better balance around its dual mandate of price stability and maximum employment,” Banco Bilbao Vizcaya Argentaria analysts told clients in a written note. They added their expectation that the central bank would normalize its policy stance by June.

The post Fed Sticks to Rate Cut Agenda, Sending Stocks Higher appeared first on theprimarymarket.com.

Fed Chair Jerome Powell revealed that the U.S. central bank appears to be gaining the confidence to introduce interest rate cuts following the release of optimistic economic data. “The Fed may have less confidence on inflation than before, but it still has confidence in the disinflation trend,” Bank of America economists observed.

With attention remaining firmly on the US Federal Reserve, the Bank of Japan is also set to convene this week. It’s largely expected to bring an end to its negative-rate policy on Tuesday. The Bank of England is set to release its own interest rate policy decision later in the week as well.

The post U.S. Stocks Rise Ahead of Fed Rate Decision appeared first on theprimarymarket.com.

Despite consumer prices remaining more sticky than expected, analysts expect that the latest CPI reading will not have a major influence on the Federal Reserve’s monetary policy and the timing of its prospective interest rate cuts. “Things are really where they should be at this point,” Oppenheimer chief investment strategist John Stoltzfus commented, expressing an indifference toward the rise in consumer prices in February.

Both Stoltzfus and chief economist for Manulife Frances Donald agreed that June appears to be a sound time for the U.S. central bank to introduce interest rate cuts. Still, expectations may be pushed back if economic data continues to show significant price increases.

The post Stubborn CPI Reading Unlikely to Affect Fed Rate Cuts appeared first on theprimarymarket.com.

Core PCE is set to come in at 2.8% for the month of January on an annual basis, marginally lower than December’s 2.9% reading. On a month-over-month basis, core PCE is set to be 0.4%, up from a 0.2% rise recorded in December. According to Bank of America, these figures are indicative that annualized inflation numbers may rebound above the Fed’s 2% inflation target.

Given that the Consumer Price Index (CPI) and the Producer Price Index (PPI) for January were hotter than expected, there is a risk that PCE could come out higher than expected, Wilmer Stith, bond portfolio manager for Wilmington Trust observed. “I don’t think they’re going to raise rates,” he said of the Fed’s monetary policy. “[But] maybe the Fed walks it back a little bit to two cuts instead of three.”

The post PCE Inflation Report Threatens to Delay Fed Rate Cuts appeared first on theprimarymarket.com.

This comes as uncertainties rise around the timing of the Federal Reserve’s interest rate cuts. In addition to the Federal Reserve’s actions, it remains uncertain whether inflation will once again rebound, thereby pushing the need for further inflation measures. Initially expected in March, the Fed is now expected by analysts to introduce interest rate cuts around May.

499 billion yuan worth of MLF loans are set to expire this month, with a net 1 billion yuan set to be injected into the Chinese economy as a result of rates remaining constant. The People’s Bank of China’s decision was not a surprising one, with 22 of 31 market watchers polled by Reuters, or 71%, all expecting rates to remain unchanged.

The post China Central Bank Holds Rates Constant appeared first on theprimarymarket.com.

Should this figure ring true, it would show the progress that the Federal Reserve has made in its fight against inflation. Overall CPI is expected to have risen by less than 3% for the first time in almost two years according to economists’ forecasts.

“In deciding when to start cutting rates, the Fed will have to reconcile the data they have in hand— which show inflation on a fast track to the 2% target—with risks that inflation could flare up again or the labor market could weaken more sharply,” Bloomberg Economics noted, adding that a final decision will most likely not be reached until shortly before the next policy meeting.

The post Slowing Inflation Boosts Interest Rate Cut Hopes appeared first on theprimarymarket.com.

“If you’re trying to get the price level back to what it was some years ago, you would really have to just crank down on the economy to do that, so that’s not in our card deck,” Goolsbee admitted during an interview on PBS. When asked about when the Fed could introduce rate cuts, the Chicago Fed president explained that the “weeks and months” of data would be used to determine this rather as opposed to only recent data.

For Goolsbee, Friday’s jobs report was a positive sign, with 353,000 jobs being added over the past month. Still, he warned that the underlying labor market may not be growing as many expect.

The post Federal Reserve Has “Months” of Data to Decide Rate Cut Timings appeared first on theprimarymarket.com.

Ahead of the Fed’s policy decision on Wednesday, markets had been anticipating signs from the central bank regarding the trajectory of its monetary policy going forward into March and beyond. “I don’t think it’s likely that the committee will reach a level of confidence” by the March meeting, Powell admitted during a press conference following the Fed’s two-day policy meeting.

Stocks had already experienced turbulence before Powell’s address following the release of quarterly earnings by several major tech players including Google parent company Alphabet Inc, which suffered a 7% slump in share value, as well as Microsoft and AMD.

The post Stocks Fall as Fed Warns That Rate Cuts Won’t Happen in March appeared first on theprimarymarket.com.