December’s consumer prices are likely to be hot, but the peak could come soon The consumer price index is released by the Labor Department Wednesday and is expected to show headline inflation jumped by 7%, its fastest pace since 1982. The Federal Reserve is already on a path to raise interest rates to battle rising prices. A hot number should justify the Fed’s policy shift. “It’s still hot, hot, hot, and it’s important because we’re now where the Fed worries about that 7% number getting baked into wages and getting more entrenched,” said Diane Swonk, chief economist at Grant Thornton. _____________________________________ So what's the number going to be?
So all newspapers have 5 headlines prepared, which is it gonna be: A. "Markets lower because off high inflation numbers" B. "Markets shrug off high inflation numbers" C. "Markets lower even as inflation numbers are lower then expected " D. "Markets rise by lower then expected inflation numbers" E. "Markets indecisive and digesting inflation data"
The market is thinking, even with 4 baby steps interest rate increases, real interest rate is still low. There is still plenty money in the market chasing things. The big tech will continue to stay strong since that is the only game in town. No one wants to park $MM money in the bank and can't catch up with inflation. Fed does not have the guts to really burst the asset bubbles.