China Daily Network September 6th As the end of summer, the US stock market may usher in a volatile decline. "As U.S. investors return to the market after the Labor Day long weekend (from Sept. 6 to Oct. 25), History suggests they will face the weakest period of the year for the S&P 500 . The U.S. stock market is already teetering.”
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The U.S. market for the year ended August, according to Refinitiv Lipper Equity mutual funds , or ETFs, fell an average of 17.3%. Among them, August fell by an average of 3.5%, reflecting the stock market's reaction to Fed Chairman Powell's speech, Powell previously said that despite the risk of recession, the Fed will continue to raise interest rates to fight inflation.
Federal Reserve Bank of Cleveland President Loretta Mester said on Wednesday that it would be a mistake to prematurely declare victory over the "inflation monster." "It's too early to conclude that inflation has peaked, let alone retreated toward 2 percent," Meister said in a speech to the Chamber of Commerce of Dayton. Only the core personal consumption expenditures index, which includes food and energy prices, fell in July. Meister supports the Fed raising its benchmark interest rate above 4% and said she does not expect a rate cut next year.
As central bank governors reiterated their determination to control inflation by raising interest rates at the Jackson Hole seminar recently, financial market investors are worried that the US economy is on the verge of recession. Households and businesses will face some pain as the Fed continues to raise interest rates to keep inflation in check, Federal Reserve Chairman Jerome Powell said at the annual meeting of global central banks in Jackson Hole, Wyoming.
Steve Hanke, a professor of applied economics at Johns Hopkins University, said he sees the U.S. economy heading for a "huge" recession next year, but not necessarily because of higher benchmark interest rates. It is reported that the U.S. GDP has declined for two consecutive quarters, with the economy shrinking by 1.6% from January to March and another 0.6% from April to June. Americans are gradually filing for unemployment benefits, many companies have announced layoffs or hiring freezes, and the housing market is softening.
Source: China Daily