© Reuters
Investing.com – CPI data is of the utmost importance to the US Federal Reserve, headed by Jerome Powell, who has repeatedly emphasized that this data is the most important in determining the inflation situation in America.
The most important inflation data for the Fed was issued in minutes and came as follows:
The annualized PCE price index came in at 5.0% after recording 5.5% in November.
On a monthly basis, the consumer expenditure price index rose by 0.1%.
As for the price index of basic personal consumption expenditures (excluding food and energy), it rose by 4.4%, as experts expected, and on a monthly basis, it rose by 0.3%, as experts expected.
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indications and
The Fed would prefer that income fall, and with it spending, as a sign of a possible further decline in inflation. The personal income index for the month of December increased by 0.2%, as expected by experts
As for the personal spending index, it decreased by -0.2%, after recording an increase of 0.1% from November.
Data summary
The data came mostly equal to expectations, which supports the slowdown in inflation, especially with the Fed’s most important indicator reaching its lowest level since October 2021. The Fed is expected to ease its tightening plan for this year with this data, which is believed to lead the markets to an improvement in today’s trading.
The Fed Rate Tracker predicts with a majority of 99.4% that the Fed will raise interest rates by only 25 basis points, from 4.5% now to 4.7% at the next February meeting.
This percentage may change if the data shows a rise in inflation, revealing the need for harsher measures by the Federal Reserve to control inflation and reduce it to 2%.
markets before the data is released
The futures contracts for the US market indices are declining in pre-opening trading, as they fell by 0.33%, and the futures contracts for the index by 0.04%, while the Nasdaq futures contracts fell by 0.56%.
At the same time, it settles in the morning session at 1929.80, awaiting data, as well as the US dollar, which settles in the range of 101.737 against a basket of foreign currencies.
Contracts are witnessing a decline of 0.92%, to now trade at $23,800 an ounce.
As for it, it fell by 0.23%, to record $ 22,936.4, while Ethereum fell more strongly, by 2.39%, to record $ 1,576 for the symbol.
