Inflation rose 6.5% year-over-year in December, reflecting the smallest annual increase since October 2021. On a monthly basis, prices declined by 0.1% from November. With the continued easing of inflation, the Fed signaled a rate-hike slowdown but also stressed that it won’t halt the rate hikes until inflation gets closer to its target of 2%.
Bob Michele, chief investment officer at JPMorgan Asset Management, asserts that interest rates will continue to rise, and inflation won't go down without a recession. He believes that although the market only anticipates rates to peak at 4.9% by the middle of this year, it can eventually hit 6%, triggering a recession.
