Analyst: This Year Inflation More Sticky, Fed Chair Candidate Continues to Be Market Focus
BlockBeats News, January 29th, Allspring analyst Matthias Scheiber stated that the job market is stabilizing, inflation is sticky, prompting the Federal Reserve to choose to wait and see, evaluating the impact of previous rate cuts on US economic growth.
The current interest rate level appears to be close to the neutral rate, which can both stabilize employment and help control inflation. Nevertheless, the AI-driven investment and capital expenditure boom, as well as a sharp rise in commodity prices including industrial metals, may lead to a stickier inflation path this year.
The market has gradually digested one of the two expected rate cuts at the end of last year. The biggest focus will still be on the announcement of the new Federal Reserve Chair, with the competition still open, but there is a general expectation that the successor to Powell will be more dovish. Government pressure on the Fed to cut rates will remain a recurring theme this year. (FXStreet)
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