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Fed's preferred inflation gauge ticks up as tariffs lift prices — casting cloud on September rate cut

1. PCE inflation gauge rose, dampening interest rate cut hopes. 2. Core PCE increased by 0.3%, highest since February. 3. Federal Reserve held interest rates steady at 4.25%-4.5%. 4. Economic growth exceeded expectations, countering recession predictions. 5. Trump criticized Powell for not lowering rates despite pressure.

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FAQ

Why Bearish?

Rising inflation signals potential interest rate stability or increases, negatively affecting stock valuations. Historical instances, like the Fed's decisions during inflation rises, often correlate with S&P downturns.

How important is it?

Current inflation concerns and Fed's decisions greatly influence market sentiment and investor behavior toward S&P 500.

Why Short Term?

Immediate reactions to inflation reports can heavily influence market volatility and sentiment, evidenced during similar past events where inflation data led to quick S&P fluctuations.

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