Every reporter: Zheng Yuhang Every editor: Gao Han
On December 13 local time, the data released by the U.S. Department of Labor showed that the U.S. consumer price index (CPI) rose by 7.1% year-on-year in November, compared with the expected 7.3% and the previous value was 7.7. %, year-on-year growth hit the lowest record since January this year, up 0.1% month-on-month, expected 0.3%, and previous value 0.4%; core CPI rose 6% year-on-year, expected 6.1%, previous value 6.3%, month-on-month rose 0.2%, Expected and previous value are both 0.3%.
After the release of the data, U.S. stocks futures rose in the short term, U.S. bond yields fell, Nasdaq futures rose nearly 4%; The U.S. dollar index fell more than 70 points in the short term, and is now at 103.71.
Image source: Yingwei Finance
The reporter of "Daily Economic News" noticed that various data of the US CPI reached a peak of about 9% in June this year, and have been slowly declining since then. Economists in the industry generally expected that the year-on-year increase in CPI in November is expected to fall further to 7.3% from the previous value of 7.7%. This means that tonight's data is not very different from market expectations. The
CPI report was released on the same day that FOMC started a two-day meeting. Compared with a year ago, the increase in various CPI data today is much higher than the healthy inflation target set by the Federal Reserve , but it is on par with the lowest level since November 2021.
The Fed is widely expected to announce a rate hike 50 basis points on Wednesday regardless of Tuesday's CPI data. Federal Reserve Chairman Powell also said recently that an important part of determining future monetary policy will be to consider the level of inflation in the service sector, excluding housing costs.
Although Fed officials have hinted that the pace of interest rate hikes will slow down in the near future, they also emphasized that interest ratesneed to remain at restrictive levels for some time. Already, the Fed is divided over how much more it should keep raising rates.
Professor from the School of Economics of Sichuan University and researcher of the Fulbright Project of the US State Department, Gong Xiuguo, responded to the comments of the reporter of "Daily Economic News" and believed that the Fed may now face a dilemma, or that the Fed may have more than enough power but not enough power.
Gong Xiuguo believes that although the growth rate of core CPI in the United States has declined slightly in November, it is still at a high level of 6%. Structural problems brought about by geopolitical conflicts, and further interest rate hikes may even cause problems such as economic recession and financial risks.
"It is expected that the 50 basis points of interest rate increase is the Fed's last resort in the face of many uncertainties, which is equivalent to reading a book while riding a donkey-reading while walking." Gong Xiuguo further explained.
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