The prolonged conflict between Israel and Iran may do more than Hashamja energy markets. One of the argument in Wall Street is that it can push the federal reserve to reduce interest rates sooner than expected.
Ryan Sweet, head of the US economy in Oxford, wrote in a recent memo to customers, on the pretext that the extended oil shock may leak to the flexible labor market in a recent memo to customers, on the pretext that the extended oil shock may compete to the flexible labor market, otherwise: “The high oil prices in oil prices can hit a more occurrence.”
This is because, historically, sudden nails in oil prices tend to a temporary rise in inflation that usually overlooks the federal reserve. But as the economy already relieves, a continuous increase can pose a greater threat to growth and jobs instead of inflation itself.
“The economy has slowed down and it is subject to anything else wrong, including the sudden and continuous increase in oil prices,” Sweet said. “If the Federal Reserve views success in the economy and the labor market greater than the temporary enlargement of inflation, the Central Bank can point out that it is open to reduce interest rates sooner.”
On Tuesday, oil prices rose, as Brent (BZ = F) rose more than $ 75 a barrel after President Trump called on Tehran residents to evacuate and reject the idea of a ceasefire Iran.
This contradicts optimism on Monday, when the Wall Street Journal reported that the tensions between Iran and Israel have eased, which sparked a crowd in American stocks and the stability of crude oil prices after price increased last week in three years.
Sweet, which is predicted by the foundation line is that the Federal Reserve will provide its first reduction in December, and indicated that it might take weeks before the markets gain a clearer feeling directed by oil prices.
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