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Peter Davis

An writer at FOMOdrive

  • Dec 12, 2023
  • 2 min read

The dollar jumped after news from the US

After the inflation data in the United States was released, the dollar experienced a sharp fluctuation before beginning to rise.

The monthly rate of price growth was slightly higher than what the market had anticipated.

After dropping during the day, the dollar index started to regain its value.

For the second consecutive month, the annual rate of inflation in the United States has decreased.

On Tuesday, December 12, the US Department of Labor reported that the consumer price index (CPI) had increased by 0.1% in November, despite no change being anticipated.

In November, consumer prices rose 3.1% compared to the same month last year, as predicted. The indicator decreased by 0.1% from the previous month and is nearing June levels, which were the lowest since February 2021.

In November, the Core CPI (excluding food and energy prices) increased by 0.3%, as predicted.

The Core CPI growth rate for the year stayed at 4.0% year-over-year, which was in line with predictions. This indicator is now at its lowest point since September of 2021.

Last month, U.S. inflation decreased once more, and the cost of gas going down further lightened the pressure of increasing U.S. consumer prices, according to AP. Gas prices dropped by 6% in the course of the month. Nevertheless, prices in certain areas—like rent, restaurants and auto insurance—kept on increasing at an uncomfortable rate.

The Fed is likely to keep its key rate unchanged on Wednesday due to a mixed picture in the inflation report. Although inflation is still above the Fed's annual target of 2%, it is cooling faster than expected, so there is no need to raise rates further at this time.

Speculation about interest rate cuts next year has been sparked by the continuous decrease in inflation, with some economists forecasting a potential cut as soon as March.

Fed Chairman Powell has firmly rejected the notion that the Fed could reduce rates in the near future. This sentiment is expected to be reiterated on Wednesday. Powell stated earlier this month that it would be "premature" to "speculate" on the possibility of the Fed cutting rates.

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