5 Safe Stocks to Buy as Inflation Shakes Wall Street (Part-1)

Consumers felt the pinch of persistently high housing costs in January, as broader price pressures rose more than expected.

The consumer price index (CPI), which tracks the cost of living for all Americans, rose 0.3% from the previous month, above the government-estimated 0.2% gain, according to the Labor Department.

Despite a drop from 3.4% in December to 3.1% in January, the annual consumer inflation rate has not gone below 3% since March 2021. As a result, inflation stayed high and ended up being more than the predicted annual rise of 2.9%.

Inflation minus energy and food, known as the core CPI, rose 0.4% from the previous month and 3.9% from the same period last year. Predictions indicated an increase of 0.3% sequentially and 3.7% annually, respectively.

Housing costs, which make up over a third of the CPI weightings, increased 0.6% monthly and 6% annually. Additionally, food costs rose, with a 0.4% increase from the previous month. In instance, the price of eggs rose, but so did the price of power and plane tickets.

The market is now delaying the first interest rate decrease by the Federal Reserve in response to inflation data that was hotter than predicted. The stock market might see some gains if the central bank follows its plan to cut interest rates many times this year

Ultimately, lowering interest rates helps the economy hum along by increasing consumer spending and company investment.

Inflation data from January has caused investors to reduce their expectations for a rate drop in May; according to the CME FedWatch tool, analysts now see just a 36.7% probability that the Fed will reduce interest rates by a quarter point. At this stage, expectations have decreased by 60% compared to last week.

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