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Real-time News
US President Trump praised the December inflation data, saying that Federal Reserve Chairman Powell should cut interest rates.Ian Lyngen, interest rate strategist at BMO: With inflation data taking a backseat to employment data, todays CPI report is unlikely to change market expectations that the Fed will hold rates steady in January. And that seems to be exactly what the market is reacting to.On January 13, it was reported that the Guangdong Financial Regulatory Bureau recently launched a crackdown on unapproved "financial holding" companies. On January 12, the Guangdong Financial Regulatory Bureau published a list of 61 business entities within its jurisdiction (excluding Shenzhen) that were using terms such as "financial holding" or "financial group" without approval, or whose names contained the word "financial holding," requiring them to apply for deregistration or change their names and business scope within three months.On January 13th, Jeff Schulze, Head of Economics and Market Strategy at ClearBridge Investments, stated that while investors may cheer the CPI report as further evidence of cooling inflation, the Federal Reserve will likely remain on the sidelines due to the short time lag between the data and the government shutdown, and the inherent uncertainty. This report is positive for risk assets and increases the likelihood of the Fed providing additional monetary policy support in 2026.January 13th - Nick Timiraos, the Feds mouthpiece, stated that the December Consumer Price Index (CPI) is unlikely to change the Feds current wait-and-see attitude, as officials are likely to want to see more evidence that inflation is stabilizing and gradually declining before cutting interest rates. The Fed has lowered its benchmark interest rate in the last three meetings, most recently in December, even though inflation stopped declining last year. Officials lowered rates due to concerns about a potentially larger-than-expected slowdown in the labor market. For Fed officials to resume rate cuts, they may need to see new evidence that labor market conditions are deteriorating or that price pressures are easing. The latter may require at least several more months of inflation data to become apparent.
