Powell's speech, commodities on the rise: Top takeaways
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Inflation data, in all its forms, has been under a microscope as the Federal Reserve has made it clear that it wants more data to inform its next decision on interest rates. Fed Chair Jerome Powell made a speech on Wednesday reiterating the point that it relies on inflation data, that inflation is on a "bumpy" path to the target goal, and that an interest rate cut is likely to happen within the year.
Commodities have been on the rise as inflation remains and supply issues have boosted prices for commodities like golld (CC=F), while the energy sector continues to perform poorly in the long term, but may have room to grow
Yahoo Finance Reporter Josh Schafer joins Market Domination Overtime to break down the top takeaways from the trading day for April 3.
For more expert insight and the latest market action, click here to watch this full episode of Market Domination Overtime.
Editor's note: This article was written by Nicholas Jacobino
Video Transcript
JOSH LIPTON: Joshua Schafer is here with a look at some of the key themes from today's action. Joshua.
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JOSH SCHAFER: Yeah, Josh. I think inflation was the big story today again, with specifically of course, we had Jay Powell talking extensively about inflation for a long period of time today, but also we had more data out on inflation. And since apparently the prices paid index from ISM is the new thing we all love to follow and that was our big market narrative this week, when you think about what we saw earlier from the prices paid index in terms of manufacturing data-- that was hot, right? And we were all worried about inflation and goods inflation potentially spiking there.
But this morning, we got the services index and the prices paid there. Prices paid hit its lowest level since March, 2020, in the services index. And last time I checked, the thing we talk about more with inflation is services. So economists largely reacted positively to this news saying that this is good sign. It's a good sign for super core inflation, which you hear the Fed talk about a lot and that being on track to coming back down to 2%.
And I guess maybe my prevailing takeaway putting those two together would just be bumpy. We're not going to get clean-- seriously though. Like we're not going to get clean data, right? If we're going to sit here and put a microscope on every little print, it's not going to keep telling you a consistent story. And so maybe just zoom out and maybe listening to what Jerome Powell is saying about, we think it's coming down eventually, it's going to be bumpy, is rather intuitive right now.