On Tuesday, The Conference Board (CB) will release the September update to its Consumer Confidence Index (CCI). The Consumer Confidence Survey reflects prevailing business conditions and likely developments for the months ahead. This monthly report details consumer attitudes, buying intentions, vacation plans, and consumer expectations for inflation, stock prices, and interest rates. The Conference Board Consumer Confidence Index® increased in August, following three consecutive monthly declines. The Index now stands at 103.2 (1985=100), up from 95.3 in July.
Federal Reserve Chair Jerome Powell vowed officials would crush inflation after they raised interest rates by 75 basis points for a third straight time and signaled even more aggressive hikes ahead than investors had expected. “We have got to get inflation behind us. I wish there were a painless way to do that. There isn’t,” Powell told a press conference in Washington on Wednesday after officials lifted the target for the benchmark federal funds rate to a range of 3% to 3.25%. “Higher interest rates, slower growth, and a softening labor market are all painful for the public that we serve. But they’re not as painful as failing to restore price stability and having to come back and do it down the road again,” he said.
A hawkish Federal Reserve crushed whatever hope investors had, plunging the stock market into a doom spiral last week and sparking traders’ fears that even more losses are on the way. U.S. equity markets tumbled last week, with the Dow briefly falling into the bear market territory and closing at a new 2022 low as concerns about recession risks rose after the Federal Reserve hiked interest rates by 75 basis points (bps) to curb inflation. For the week the Dow declined 4% and the S&P 500 shed 4.7%, while the Nasdaq contracted 5%. Treasury yields rose to their highest levels in over a decade. The inversion of the yield curve deepened, as the yield on the two-year note rose above 4.2%, in a sign of growing pessimism regarding the near-term health of the economy.
Officials forecast that rates would reach 4.4% by the end of this year and 4.6% in 2023, a more hawkish shift in their so-called dot plot than anticipated. That implies a fourth-straight 75 basis-point hike could be on the table for the next gathering in November, about a week before the US midterm elections.
Now, central banks around the world are racing each other to step up their fight against inflation at the cost of growth. last week, more than a dozen central banks moved to tighten monetary policy.
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