Geopolitical concerns, high inflation, and the Federal Reserve’s aggressive interest rate hikes had kept the stock market under pressure last year, with the major indexes delivering negative returns. With the Fed’s raising interest rates to the highest level since 2008, inflation showed signs of easing in the last three months of the year.
December’s consumer price index (CPI) showed a 6.5% year-over-year rise in prices while it declined 0.1% sequentially. Although inflation is showing signs of cooling, minutes from the Fed’s policy meeting in December showed that the central bank officials expect higher interest rates to remain this year until more progress is made on bringing inflation down to its 2% target.
