Stocks Gain Ground As Inflation Meets Analyst Expectations
Inflation Rate Stays Below 7%
U.S. has just released Inflation Rate and Core Inflation Rate reports for November. The reports indicated that Inflation Rate increased by 0.8% month-over-month. On a year-over-year basis, Inflation Rate grew by 6.8%. Core Inflation Rate increased by 4.9%. The reports were in line with the analyst consensus, which is a major relief for those who worried that inflation would exceed 7%.
S&P 500 futures gained upside momentum after the release of inflation reports which is not surprising as the market feared that Fed could be forced to raise rates in the first half of 2022.
Today, traders will also have a chance to take a look at Consumer Sentiment report for December. Analysts expect that Consumer Sentiment decreased from 67.4 to 67.1.
U.S. Dollar Loses Ground After Inflation Reports
The U.S. Dollar Index, which measures the strength of the U.S. dollar against a broad basket of currencies, has moved from 96.40 to 96.10 after the release of inflation reports.
Meanwhile, Treasury yields have also found themselves under some pressure as inflation met analyst estimates.
It remains to be seen whether the U.S. dollar will be able to develop significant downside momentum as Inflation Rate of 6.8% is high, and the Fed will have to cut its asset purchase program fast to deal with rising prices.
Gold Gets Back Above $1775
Gold has been trading near the $1775 level since the beginning of this month, and recent inflation reports may provide it with an opportunity to gain additional upside momentum.
Silver received support near $21.90 and moved back above the $22 level, which may provide some support to silver mining stocks at the start of today’s trading session.
For a look at all of today’s economic events, check out our economic calendar.