Although cooling inflation for the sixth consecutive time in December 2022 has raised investor optimism, the Fed officials’ hawkish comments signaling interest rate hikes throughout 2023 could keep the stock market under pressure.
Moreover, U.S. retail sales dropped 1.1% in December, and manufacturing output fell 1.3%, triggering recessionary fears. This indicates that consumers are losing steam, and business investments are declining, reflecting weaker economic growth.
