More Articles  Printer Friendly Version

 
Featured News    Financial Briefs    Market Data Bank    Articles Of Interest    

Fed Changes Its Inflation Stance

4981 1

The Federal Reserve has abandoned its “inflation is transitory” stance and says inflation is “persistent.” Stocks lost 2% from last week’s all-time closing high.

4981 3

The change in Fed policy is illustrated in this chart by Fritz Meyer, an independent economist. The Fed had been predicting inflation would peak at 4.1%. But its inflation benchmark, the Personal Consumption Expenditure Deflator, shot past 4.1% to 5% in October.

On Wednesday, at a press conference, the Fed chief admitted inflation has been more persistent than expected and said the Fed now expects inflation to peak at between 5.3% and 5.4%, shown in the dotted gray lines in the chart above. The peak will occur in the first quarter of 2022, according to the Fed forecast, and then collapse to 3% or less in the second quarter of 2022.

4981 4

The Standard & Poor’s 500 stock index closed Friday at 4,620.64. The index lost -1% from Thursday and -2% from last week, when it closed at an all-time high. The index is up +69.5% from the March 23, 2020, bear market low.

Nothing contained herein is to be considered a solicitation, research material, an investment recommendation, or advice of any kind, and it is subject to change without notice. Any investments or strategies referenced herein do not take into account the investment objectives, financial situation or particular needs of any specific person. Product suitability must be independently determined for each individual investor. Tax advice always depends on your particular personal situation and preferences. You should consult the appropriate financial professional regarding your specific circumstances. The material represents an assessment of financial, economic and tax law at a specific point in time and is not intended to be a forecast of future events or a guarantee of future results. Forward-looking statements are subject to certain risks and uncertainties. Actual results, performance, or achievements may differ materially from those expressed or implied. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete, and is not intended to be used as a primary basis for investment decisions. This article was written by a professional financial journalist for Advisor Products and is not intended as legal or investment advice.


Email this article to a friend


Index
Investing In An Economy Beset By Multiple Anomalies
Despite Bad Economic News, Stocks Rose 4% In The Week Ended July 29, 2022
Amid Bad Data Releases, Leading Economists Predict No Recession
Good News: Real Retail Sales Dropped Fractionally In The Past Year
Financial Economic News Analysis
The Good News Is All This Bad News
Four Signs A Recession Could Be Short And Shallow
Odds Of A Soft Landing Shrunk After Friday's News
Bad Inflation Surprise Sends Stocks Down Sharply
It Could Be A Long, Hot Summer For Investors
What A Difference A Week Makes
Amid Stock Market Turmoil, +2.3% Growth Projected In 2022
Staying On Track Amid The Ukraine And Inflation Crises
For Investors, 2022 Is Turning Into A Test
Is The Economy Brightening? Or Is The Federal Reserve Slamming The Door On Growth
Financial Economic News In Perspective

This article was written by a professional financial journalist for Beacon Financial Advisors, Ltd. and is not intended as legal or investment advice.

©2022 Advisor Products Inc. All Rights Reserved.
© 2022 Beacon Financial Advisors, Ltd. | 1800 St. James Place, Suite 101, Houston, TX 77056 | All rights reserved
P: 713-622-9981 | F: 713-622-5814 | josh@bfaltd.com |
Disclosure | Privacy Policy | Contact Us | Home