Stock markets make gains ahead of January CPI inflation report
All three major Wall Street indexes made gains on Monday ahead of the Labor Department’s Consumer Price Index report on inflation for January. After dipping 0.1% in December, economists are predicting headline inflation to rise 0.5% last month. The past three months have seen inflation come in below forecasts, but a higher-than-expected reading could stymie a rally by stocks and bonds after taking a beating last year.
Currently, markets are confident that the Federal Reserve can pull off a “soft landing” as they pull back from the fastest pace of rate hikes since the 1980s, the last time inflation reached such heights as have been experienced over the past year. Tuesday’s CPI data will help investors parse out what any possible direction the central bank will take going forward to wrestle down rising prices back to policymakers target of 2%.
