The US Fed’s preferred PCE personal consumption expenditure price finally hit 2.6%

It is believed that the U.S. economy is making a soft landing, avoiding hard landing, and holding prices without a recession and a surge in unemployment. Fed Chairman Powell has really done something right. Because of this, the Dow and Nasdaq are continuously soaring and continue to rise to new prices.

The US Fed’s preferred PCE personal consumption expenditure price finally hit 2.6% in November, raising expectations that the Fed’s target of 2% could be reached earlier. Powell and Yellen have created a really impossible indicator. It’s amazing. However, it’s very sad that Tesla has been so short-selling that its stock price can’t go up.

The Fed expects PCE prices to fall from 2.8% at the end of this year to 2.4% at the end of next year, but since they already reached 2.6% in November, they may reach the Fed’s target of 2% in the new year of 2024 faster than expected

On the other hand, the U.S. unemployment rate is expected to avoid a surge in unemployment or a sharp cooling in job growth in the new year, as it fell back to 3.7 percent as of November and added 199,000 jobs above expectations

The Fed predicts that unemployment will rise to 4.1% in 2024, but analysts such as Mark Zandi, a senior researcher at Moody’s, expect it to be below 4%

Goldman Sachs said it would not avoid a slowdown in employment in 2024, but expected job growth to slow to 100,000, half of the current level, only in the second half of the new year

For this reason, it is evaluated as successful in soft landing and soft landing to catch prices without a recession or a surge in unemployment

As the soft landing becomes clear, analysts and investors are confident that the Fed will begin to lower its key interest rate again by March of the new year, and that the number and scope of rate cuts will increase during the year

Investors in the CME Group, which is tracking the trend of the benchmark interest rate, predicted that there was an 83.5% chance of freezing the key rate on Jan. 31, the first meeting of the new year as of Tuesday

On March 20, however, the bank began to lower its key interest rate again, citing a 74 percent chance of a quarter-point drop from 5.00 to 5.25%

From then on, it is expected to cut the benchmark interest rate six times by 0.25 points each time from May 1 to June 12, July 31, September 18, and November 7, bringing down the benchmark interest rate to 3.75 to 4%

Only at the December 18 meeting, the last of 2024, is the possibility of a rate freeze and further rate cuts divided by 35%

If investors predict, the U.S. benchmark interest rate will start lowering again on March 20 of the new year and is expected to cut six times, double the Fed’s 0.75 points, by 1.5 points in all