Will the latest inflation data fuel the stock market rally?

  • Inflation data shows price increases are losing steam
  • Core PCE index expected to have risen 3.5% in October
  • Lowest inflation prints since spring 2021
  • Stock market rallying on hopes of Fed rate cuts
  • Last major inflation indicator before Fed’s next policy meeting

The Federal Reserve’s preferred measure of inflation, the core PCE index, is expected to have risen 3.5% in October, marking the lowest inflation prints since spring 2021. This data is crucial as it could determine the next stage of the stock market rally driven by hopes of Fed rate cuts. Traders are increasingly betting on the Fed adopting a more dovish tone, with expectations of as many as seven rate cuts next year. The upcoming release of the PCE inflation data will provide further insight into whether these expectations will be met, potentially fueling more gains in the stock market or knocking stocks down a peg. This is the last major inflation indicator before the Fed’s next policy meeting, making it particularly important for investors and the market.

Factuality Level: 7
Factuality Justification: The article provides information about the expected release of the core personal-consumption expenditures (PCE) index and its potential impact on the stock market. It includes data from a survey of economists and mentions the recent performance of the S&P 500. The article also mentions the expectations of traders and the likelihood of rate cuts by the Federal Reserve. Overall, the article provides factual information based on current market trends and expectations.
Noise Level: 6
Noise Justification: The article provides information on the expected drop in the Federal Reserve’s preferred measure of inflation, which could impact the stock market rally. It also mentions the recent performance of the S&P 500 and the weakening of the dollar. However, the article lacks in-depth analysis, evidence, and actionable insights. It mainly focuses on short-term market movements and speculations about future rate cuts.
Financial Relevance: Yes
Financial Markets Impacted: The article discusses the potential impact of inflation data on the stock market and the Federal Reserve’s monetary policy.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Rating Justification: The article focuses on the impact of inflation data on the stock market and the Federal Reserve’s monetary policy, without mentioning any extreme events.
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Reported publicly: www.marketwatch.com www.wsj.com