1. PCE index rose 2.6% year-over-year, higher than target. 2. Core PCE remained at 2.8%, aligning with expectations. 3. Fed holds key interest rates steady amid inflation concerns. 4. Inflation is expected to decline through 2025, says Fed Governor. 5. Fed officials emphasize need for inflation improvements before rate changes.
Higher inflation may pressure the Fed to adjust rates, impacting market sentiment. Past instances show that market reacts negatively to rising inflation fears.
Inflation data directly affects interest rates, influencing overall market dynamics. High inflation readings can lead to corrective measures impacting the S&P 500.
Inflation settings influence Fed policies which have prolonged effects on the market. Historical rate changes usually affect the market over several months.