Too consistent, too emotional. That's when the risk comes out.
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• M1 (Narrow Money Supply): • Currency in circulation • Demand deposits (checkable deposits) • Other deposits that can be readily available for use • M2 (Broad Money Supply): • Includes all items from M1 • Savings deposits • Time deposits (fixed deposits) • Money market funds • Other short-term financial instruments that are close substitutes for money
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Sure, here are the key points about how higher-than-expected U.S. CPI data might increase the likelihood of the Federal Reserve lowering interest rates: 1. Reduced Inflation Pressure: Lower-than-expected CPI indicates easing inflationary pressures, providing room for rate cuts. 2. Economic Growth Slowdown: A slowdown in economic growth may prompt the Fed to lower rates to stimulate the economy. 3. Labor Market Changes: Slowing job growth or rising unemployment could increase the likelihood of rate cuts. 4. Market Expectations: Market expectations of rate cuts can influence the Fed’s actual policy decisions. 5. Policy Flexibility: When inflation is not a primary concern, the Fed may adopt a more flexible policy, including rate cuts. 6. Inflation Expectations Management: Rate cuts can help manage inflation expectations and stabilize market confidence.
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