A long time coming, the Federal Reserve will likely lower the benchmark interest rate. And that may have significant implications for loanDepot (LDI), which specializes in mortgage loans and other credit-based products, including unsecured personal loans. While a long-term investment in LDI stock may still be a risky proposition, options activity suggests that a near-term scalp could be in the cards.
Fundamentally, the Fed may have the necessary data to justify a pivot toward a dovish monetary policy. As Barchart contributor Don Dawson explained, “US producer prices, often a precursor to where consumer prices might be heading, rose by just 0.1% month-over-month in July, a figure that came in lower than economist forecasts. Over the year, the Producer Price Index (PPI) increased by 2.2%, hovering near the Federal Reserve's (Fed) 2% inflation target.”
