Now: Still the Same Tones
The inflation data from US yesterday showed a very concern situation. The Consumer Price Index (CPI) jump to 9.1% Year over Year in June in which far above the predicted figure at 8.8%. The core reading however show a minor decrement from the previous data to 5.9% from 6% although still above the expectation which is at 5.8%.
This figure has spurred another panic with all equities slump down and the demand for the government bond fall in which increased the yield as people are expecting the FED to go stricter in the monetary policy in upcoming meeting and as a result the risk for the recession increasing.
Bank of Canada (BoC) increased their interest rate by 100-basis points to 2.5% and beat the market expectations which is 75-basis points increment. In the statement, they acknowledged that the current inflation rate is way beyond what they imagine and now they will take thing more seriously.
14 July 2022