Has Inflation Peaked Yet? It's Complicated, but Here's What We Know
Markets have been rallying all week and all month. Investors are starting to believe that inflation, which has been at a 40-year high this year, may finally be starting to peak. This would be good for the market because a hawkish Federal Reserve has been aggressively raising its benchmark overnight lending rate, the federal funds rate, in an attempt quickly get control of the situation. But with the Fed moving so quickly, the market is concerned that the agency might tip the economy into some kind of severe recession.
So, the recent data is certainly good news. But has inflation really peaked? It's actually hard to say at the moment. Here is what we know so far.
Fresh data for the Consumer Price Index (CPI), which tracks prices on a range of daily consumer goods and services, showed that the index rose 8.5% on a year-over-year basis in July. It shows that prices are high, but the CPI rose 9.1% year over year in June, and economists had projected an 8.7% rise in July. Furthermore, the CPI remained unchanged month to month.
Source Fool.com
