Both the October CPI report and the job report came in above expectations. The Fed could act to stabilize prices by raising interest rates sharply. Higher interest rates typically weigh on stock prices, but how quickly the Fed raises rates can have a big impact on the market. Interest rates are climbing again. The Federal Reserve Open Market Committee (FOMC) enacted its first rate hike in more than three years in September. And now it's looking increasingly likely the Fed will implement another rate hike at its December meeting. Inflation continues to run well above the Fed's target 2% rate while the labor market has remained solid. That gives the Fed room to focus on the "stable pricing" side of its dual mandate.
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