The Consumer Price Index (CPI) rose 9.1% year-over-year in June, surpassing the 8.8% Dow Jones estimate. The hotter-than-expected inflation data could make the Federal Reserve even more aggressive in raising the benchmark interest rates. The Fed officials have signaled to lift interest rates by 75 basis points later this month.
As rising interest rates drive borrowing costs higher for businesses, companies possessing low liquidity could struggle to stay afloat. David Trainer, the founder and CEO of research firm New Constructs, wrote in a research note, “Time is running out for cash-burning companies kept afloat with easy access to capital.”
