
By
For the last three years, the US and Europe have struggled with a specter unseen for a generation – inflation. Now it looks like the phantom may finally be fading.This week the US Federal Reserve, European Central Bank and the Bank of England all held interest rates steady and cautiously signaled that the fight to tamp down soaring prices may be coming to an end.“We’re seeing inflation making real progress. These are the things we have been wanting to see,” the Fed chair, Jerome Powell, said on Wednesday after announcing the central bank would once again pause rate rises.The Fed went as far as to signal that it was considering three cuts in 2024 to its benchmark interest rates – which have shot up from near zero in 2020 to a 22-year high of 5.25% to 5.5% as Powell has fought to bring inflation under control.Having initially dismissed the rising prices as a “transitory” phase triggered by the supply chain disruptions of the coronavirus pandemic, Powell has remained cautious even as inflation has steadily fallen. “We can’t know. We still have a ways to go. No one is declaring victory. That would be premature,” he said on Wednesday.Investors were less circumspect. After the news the Dow Jones hit a new record high, closing above 37,000 for the first time.In Europe, there was also – qualified – good news about inflation as the European Central Bank (ECB) announced it would hold rates steady. The ECB cut its inflation predictions for 2024 and removed the phrase “inflation is expected to remain too high for too long” used in previous statements.While the Eurozone’s inflation rate has now fallen from over 9% to close to the ECB’s target of 2%, the ECB president, Christine Lagarde, said the central bank had not even discussed rate cuts for next year. “Should we lower our guard? We asked ourselves that. No – we should absolutely not lower our guard,” she said.But the rate pause – the second in …
See the entire article on inflation, or, read more Arizona real estate investing news. It’s your call!