The October Consumer Price Index (CPI) reflected a 7.7% increase over last year and a 0.4% increase over the prior month, according to the Bureau of Labor Statistics. This is below the Dow Jones estimate of 7.9% and 0.6%. However, even with the slowdown, inflation still remains well above the Fed’s 2% target.
On the other hand, analysts believe the economy could soon see a rebound as midterm elections have historically set up nice rallies of phenomenal consistency. “In midterm election years, you normally see a major bottom in the fourth quarter. The market is in a bottoming process now. It is hard to deny that. It could lead to a significant market rally,” said Paul Schatz, the founder and president of Heritage Capital.
