{"id":602,"date":"2024-03-22T22:28:00","date_gmt":"2024-03-22T22:28:00","guid":{"rendered":"https:\/\/capricorne.in\/caprinsights\/?p=602"},"modified":"2024-04-04T12:26:15","modified_gmt":"2024-04-04T12:26:15","slug":"continuing-on-a-pause","status":"publish","type":"post","link":"https:\/\/capricorne.in\/caprinsights\/thinkwink\/continuing-on-a-pause\/","title":{"rendered":"Continuing on a Pause?"},"content":{"rendered":"\n

The FED kept interest rates stable for a fifth time in a row. Despite inflation showing a significant downward trend, the FED\u2019s decision to maintain rates stable comes backed by the fact that they want to time their rate cuts in a manner that encourages inflation numbers to go down to their target of 2%. While Powell indicated that it seems uncertain as to when the US will achieve the inflation target, it is something that they are sure to achieve.<\/p>\n\n\n\n

It\u2019s interesting to note that January and February witnessed higher CPI (Consumer Price Index) and PCE (Personal Consumption Index) which was in turn indicative of a lower inflation. On a 6-month basis, overall prices were up 3.2 percent and core prices were up 3.9 percent. \u00a0Housing inflation which peaked at 10.30% in December 2022, has come down to 4.30% in February 2024. The lower rates of unemployment also acted in favor of the FED\u2019s decision. Having said that, the FED is likely to cut rates as goods prices come into an equilibrium and housing prices move down.<\/p>\n\n\n\n

We think that with the FED trying to balance risks and ensure that data is clearly supportive of a long-term reduction in the inflation, we are likely to see the rates remain stable for a little longer that we initially anticipated.<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

The Impact on India:<\/p>\n\n\n\n

With the US Dollar declining in value and International Gold prices touching new highs, Indian Investors are likely to book some profits in the yellow metal. On the other hand, expectations around a significant rise in gold prices have also led to investors flocking to buy Gold. It may seem like the Indian markets have largely priced FED\u2019s decision of keeping rates stable. However, the Indian markets are currently volatile and are likely to remain so, until the upcoming election, thus presenting buying opportunities for investors. \u00a0The Indian economy is currently being buoyed by the magnitude of domestic flows and this significantly reduces the impact of the global rates.<\/p>\n\n\n\n

The current environment seems conducive for investment growth, particularly in sectors poised to benefit from economic expansions. However, it’s important to note the backdrop of global economic dynamics, including potential oil price fluctuations.<\/p>\n","protected":false},"excerpt":{"rendered":"

The FED kept interest rates stable for a fifth time in a row. Despite inflation showing a significant downward trend, the FED\u2019s decision to maintain rates stable comes backed by the fact that they want to time their rate cuts in a manner that encourages inflation numbers to go down to their target of 2%. While Powell indicated that it seems uncertain as to when the US will achieve the inflation target, it is something that they are sure to achieve. It\u2019s interesting to note that January and February witnessed higher CPI (Consumer Price Index) and PCE (Personal Consumption Index) which was in turn indicative of a lower inflation. On a 6-month basis, overall prices were up 3.2 percent and core prices were up 3.9 percent. \u00a0Housing inflation which peaked at 10.30% in December 2022, has come down to 4.30% in February 2024. The lower rates of unemployment also acted in favor of the FED\u2019s decision. Having said that, the FED is likely to cut rates as goods prices come into an equilibrium and housing prices move down. We think that with the FED trying to balance risks and ensure that data is clearly supportive of a long-term reduction in the inflation, we are likely to see the rates remain stable for a little longer that we initially anticipated. The Impact on India: With the US Dollar declining in value and International Gold prices touching new highs, Indian Investors are likely to book some profits in the yellow metal. On the other hand, expectations around a significant rise in gold prices have also led to investors flocking to buy Gold. It may seem like the Indian markets have largely priced FED\u2019s decision of keeping rates stable. However, the Indian markets are currently volatile and are likely to remain so, until the upcoming election, thus presenting buying opportunities for investors. \u00a0The Indian economy is currently being buoyed by the magnitude of domestic flows and this significantly reduces the impact of the global rates. The current environment seems conducive for investment growth, particularly in sectors poised to benefit from economic expansions. However, it’s important to note the backdrop of global economic dynamics, including potential oil price fluctuations.<\/p>\n","protected":false},"author":2,"featured_media":605,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"advanced_seo_description":"","jetpack_seo_html_title":"","jetpack_seo_noindex":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[2],"tags":[25,19,21,24,20,22,14,18,23,17],"ppma_author":[44],"class_list":["post-602","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-thinkwink","tag-equity-investing","tag-equity-markets","tag-fed","tag-financial-planning","tag-interest-rates","tag-market-outlook","tag-mutual-funds","tag-stock","tag-stock-investing","tag-wealth-advisory"],"jetpack_publicize_connections":[],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"https:\/\/i0.wp.com\/capricorne.in\/caprinsights\/wp-content\/uploads\/2024\/03\/Blue-White-Modern-Brand-Typography-Logo.png?fit=1500%2C1500&ssl=1","jetpack-related-posts":[],"authors":[{"term_id":44,"user_id":2,"is_guest":0,"slug":"kavitha-narayan","display_name":"Kavitha Narayan","avatar_url":"https:\/\/secure.gravatar.com\/avatar\/cb30c75af17d46b750442d6d8e9708a0?s=96&d=mm&r=g","author_category":"","first_name":"Kavitha","last_name":"Narayan","user_url":"","job_title":"","description":"Kavitha has a strong background in Products, Fund Research, Performance Analysis and Operations with leading names such as Morningstar, HSBC and BNY Melon to name a few."}],"_links":{"self":[{"href":"https:\/\/capricorne.in\/caprinsights\/wp-json\/wp\/v2\/posts\/602","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/capricorne.in\/caprinsights\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/capricorne.in\/caprinsights\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/capricorne.in\/caprinsights\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/capricorne.in\/caprinsights\/wp-json\/wp\/v2\/comments?post=602"}],"version-history":[{"count":4,"href":"https:\/\/capricorne.in\/caprinsights\/wp-json\/wp\/v2\/posts\/602\/revisions"}],"predecessor-version":[{"id":609,"href":"https:\/\/capricorne.in\/caprinsights\/wp-json\/wp\/v2\/posts\/602\/revisions\/609"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/capricorne.in\/caprinsights\/wp-json\/wp\/v2\/media\/605"}],"wp:attachment":[{"href":"https:\/\/capricorne.in\/caprinsights\/wp-json\/wp\/v2\/media?parent=602"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/capricorne.in\/caprinsights\/wp-json\/wp\/v2\/categories?post=602"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/capricorne.in\/caprinsights\/wp-json\/wp\/v2\/tags?post=602"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/capricorne.in\/caprinsights\/wp-json\/wp\/v2\/ppma_author?post=602"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}