Producers of metals and other raw materials experienced a surge in the market after the release of consumer price data, sparking speculation of a dovish comment from the Federal Reserve on Wednesday.
"Goldilocks" Scenario Raises Questions
Despite the recent rally in the stock market, one strategist has raised concerns about a potential economic slowdown. This strategist argues that the current "Goldilocks" scenario does not align with the signs of an impending economic downturn.
Skepticism Surrounds Soft Landing Predictions
Brent Schutte, Chief Investment Officer at Northwestern Mutual Wealth Management, expressed skepticism about the likelihood of a soft landing. He highlights various indicators, such as job data and the ongoing manufacturing slowdown, that cast doubt on this outcome. While the Federal Reserve aims for a soft landing when implementing monetary policy to cool down an overheated economy, their success rate has been less than impressive.
Consumer Price Index Holding Steady
According to the Labor Department, the consumer-price index rose by 3.1% in November compared to the previous year. While this represents a slight decrease from October's figures, it remains above the June trough of 3%. Surprisingly, there was a 0.1% increase in prices on a month-to-month basis.