Federal Reserve (Fed) Bank of St. Louis President Alberto Musalem hit the wires on Wednesday, noting that sticky inflation figures make it difficult for the Fed to continue to ease rates. The Fed's Musalem spun focus onto the overall healthy appearance of the US labor market to ease negative pressure from admitting that inflation continues to flaunt downward pressure from the Fed.
Key highlights
The US central bank may be on the last mile to price stability, inflation is expected to converge to the 2% target over the medium term.
Recent information suggests that the risk of inflation moving higher has risen, while risks to the job market remain unchanged or have fallen.
The business sector is generally healthy, though the smallest businesses and those in the consumer discretionary market is seeing slower earnings growth.
Recent high productivity could prove durably structural, but that remains uncertain.
Growth is broad-based and driven by consumption, income growth, productivity, supportive financial conditions, and wealth effects.
Strong economy on track for a solid fourth quarter.
Monetary policy is to remain appropriately restrictive while inflation remains above 2%.
Further rates easing may be appropriate if inflation continues to fall.
Monetary policy is well positioned, the Fed can judiciously and patiently judge incoming data to decide on further rate cuts.
The pressure in services industries is slowly abating.
Core consumer price index and core personal consumption expenditures price index remain elevated.
I am attuned to the risks of rising layoffs, though disorderly deterioration of labor market is unlikely given health of businesses.
I expect economy to grow closer to 2% rate going forward.
Monetary policy is restrictive, but financial conditions overall are supportive of economic activity.
It is hard to derive much signal from most recent jobs report; low number clouded by storm and other impacts.
I do not think the dollar's status is challenged by crypto currencies.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD falls toward 1.0500 amid risk-off mood
EUR/USD has come under fresh selling pressure, easing toward 1.0500 in the European session on Thursday. The pair faces headwinds from risk-off flows due to rising geopolitical conflict between Russia and Ukraine and worries over the potential US tariffs on the EU. ECB- and Fedspeak are awaited.
GBP/USD stays pressured toward 1.2600 ahead of US data, Fedspeak
GBP/USD remains pressured toward 1.2600 in European trading on Thursday. The pair's underperformance could be attributed to a risk-aversion market environment. Traders stay cautious amid rife geopolitical tensions ahead of mid-tier US data and Fedspeak.
Gold price extends gains beyond $2,650 amid rising geopolitical risks
Gold price extends its bullish momentum further above $2,650 in Thursday's European session. Gold price risies for the fourth straight day, sponsored by geopolitical risks stemming from the worsening Russia-Ukraine war. US data and Fedspeak are next in focus.
Shiba Inu holders withdraw 1.67 trillion SHIB tokens from exchange
Shiba Inu (SHIB) trades slightly higher, around $0.000024, on Thursday after declining more than 5% the previous week. SHIB’s on-chain metrics project a bullish outlook as holders accumulate recent dips, and dormant wallets are on the move, all pointing to a recovery in the cards.
Why Nvidia’s story is far from over
Nvidia delivers another earnings beat: Nvidia exceeded expectations with $35.08 billion in revenue, a 94% year-over-year increase, driven by strong performance in its data center business, which more than doubled to $30.8 billion.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.