- Inflation and consumer sentiment driving Federal Reserve policy
- University of Michigan tracks consumer sentiment while the FED survey tracks American debt and wealth.
US Consumer Sentiment Influences Fed Rate Hike Expectations and Eurozone Markets
What happened
The University of Michigan consumer sentiment survey was released, alongside US NFP and Canadian employment data. This survey, combined with the rout in tech stocks, has lowered the probability of a December Federal Reserve rate hike to 67% from earlier estimates. In the European session, low-tier releases were expected to cause muted market reactions.
From investinglive.com
Why it matters
The market reaction to the US economic reports is described as tricky. A poor US report could strengthen growth concerns and extend risk-off sentiment. Conversely, it could lead to a dovish repricing in interest rate expectations and support risk assets.
The University of Michigan tracks consumer sentiment, while the FED survey tracks American debt and wealth, both informing expectations regarding policy.
From investinglive.com
Who's involved
- FEDThe US central bank whose rate hike expectations are being influenced by economic reports.
- University of MichiganProvides consumer sentiment surveys that inform FED monetary policy decisions.
- eurozoneRegion whose market reaction is being influenced by US Fed expectations.
Who could feel it
Possible knock-on effectsThese are possibilities Brind reasoned out, not predictions, and not advice. Most are not stated in any report.
- euroSpeculative
US rate hike expectations could influence global capital flows and market sentiment.
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The entities involved
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FED
business
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eurozone
region of EU countries using the Euro
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University of Michigan
public research university in Ann Arbor, Michigan
Related events
- US inflation and growth are driving expectations of a Fed rate hike, while the dollar's strength pressures the euro.
- Rate hikes are affecting financial products and market returns due to actions by the FED.
- Rate hikes by the FED are affecting the U.S. consumer market, which is being monitored by regional banks.
- Reports indicate the Federal Reserve needs to hike rates, leading to increased bond market anxiety.
- Inflation concerns are driving fears of Fed rate hikes, negatively impacting equity valuations.