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Consumer prices jump much more than forecast, sparking inflation fears

“U.S. consumer prices rose considerably more than expected in January, fueling fears that inflation is about to turn dangerously higher” writes unknown author for cnbc.com. The Consumer Price Index rose 0.5 percent last month against projections of a 0.3 percent increase, the Labor Department reported Wednesday.Excluding volatile food and energy prices, the index was up 0.3 percent against estimates of 0.2 percent.The report indicated that price pressures were “broad-based,” with rises in gasoline, shelter, clothing, medical care and food. Investors also began to price in the likelihood that the Federal…

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Fed on track to hike rates with hotter inflation data, but weak retail sales raise worries

“Traders said the weak retail sales reading contained what could have a much sharper move in interest rates” writes Patti Domm for cnbc.com. “You have to worry about more inflation, worry more about the Fed,” said Michael Schumacher, director of rate strategy at Wells Fargo. Source: cnbc.com Share This:

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Skiddish Markets Are Spooked by Looming Interest Rate Hike

“Ten years of zero interest rates has surely misdirected tidal waves of what the wisest economists have called malinvestment that probably cannot survive normal market interest rates” writes A Senior Fellow for observer.com. And now, interest rates are starting to trend upward in the markets, and inflation is peaking over the horizon again.The Fed needs to raise interest rates as slowly as possible to avoid a panic that would disturb Trump’s boom.Skyrocketing interest rates are very contractionary and threaten a return to the financial dungeons.Restoring market interest rates would ultimately…

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A $470 billion investment chief at JPMorgan tells us ‘the US is losing its fiscal discipline’ — and he says that’s huge risk for markets

“And then if you any sort of fiscal stimulus from the budget that’s going to add more to earnings” writes Pedro Nicolaci Da for businessinsider.com. “We just see from our position the flow of money coming in from Asia and Europe into the US market,” he said.So I think that’s what we have to watch in the next couple of years, is the growth in earnings versus the rise of interest rates.That’s putting enough upward pressure on US interest rates to shake the stock market out of a prolonged bullish…

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The stock market has a ‘funny way of testing new Fed chairs’

“The research firm offers some additional interesting statistics and fun facts about Fed leadership and stock market performance “Weakness after a new Fed chair is quite normal” writes Pedro Nicolaci Da for businessinsider.com. “As Janet Yellen hands over the reins to Jerome Powell at the Federal Reserve (Fed), a look back at history shows that markets have a funny way of testing new Fed chairs,” LPL analysts wrote in a blogpost.Alan Greenspan is the perfect example of a Fed chair who faced a market crash shortly after he took over,…

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Policy Daily Review February 13, 2018

Policy Daily Review for February 13, 2018 British Pound May Rise as UK CPI Boosts BOE Rate Hike Bets The British Pound may rise if UK inflation data tops consensus forecasts, pushing the markets to reprice standing BOE policy bets for a sooner interest   ‘We can only take so much abuse’: Whole Foods suppliers slam ‘hellacious’ new policies and say rising costs are hurting business Some small and local vendors who work with Whole Foods say new fees are damaging their business and they’re considering cutting ties.   Have…

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Fed’s Mester: Economy will ‘work through this episode of market turbulence’

“It would guard against the risk that the economy might overheat and helps avoid a buildup of risks to financial stability, she added” writes Senior Economics Reporter for marketwatch.com. The sharp moves in the stock market seen over the past 10 days remain “far away” from being large enough to spill over and damage the economy, said Cleveland Fed President Loretta Mester, on Tuesday. “I expect the economy will work through this episode of market SPX, +1.39% DJIA, +1.70%  turbulence and I have not changed my outlook,” Mester said in…

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