Investing.com – Risk appetite has declined as the perception that inflation will have an impact on interest in the US, despite its below-expected data. Losses in Europe exceeded 2% on the trading day, when the world stock markets were sold.
Down 2.5%, Hong Kong Technology fell 3.5%. Today, while the decline continues on the side, there is a decline in the US futures.
With the deterioration of the global climate, indices are traded with sellers in the country. Having seen the highest level after March 22 by increasing to 1,462 points yesterday, today it started the day at 1,446 points with a 0.96% decrease and the index decreased to 1,441 points during the day.
While the index is experiencing the most decline with a loss of 4.5% today in the stock market, it diverges positively. The daily loss in
In addition to growth in the US, the increase in global food and commodity prices will increase inflation and the Fed’s bond interest rate has increased over 1.60 again, with the thought that the Fed will reduce asset purchases earlier than expected, and the selling pressure is increasing with this development in the stock markets. These sales were experienced many times in the first quarter of the year, and how long this week’s sales will continue will change according to economic data, explanations and expectations. The figures coming from the USA tomorrow will have a very important effect on pricing. In March, it had increased from 1.7% to 2.6%, although the difference was quite high, coming within an expected range made the markets breathe. The April expectation is for the CPI to rise from 2.6% to 3.6%, which is above the Fed’s medium-term target. In addition, this increase is expected not to be a peak during the year, in other words, the increase is expected to continue.
If the increase in inflation accelerates, the thought that the Fed will tighten earlier than anticipated will be strengthened. In this scenario, the dynamism to be seen in the bond and dollar indicator may increase the pressure on indices.
If the CPI increases lower than expected, there may be a short respite in the markets as in March, but the general opinion is that inflation will increase during the year and this will force the markets over interest.
Author: Deniz Engin
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