JPMorgan: The Fed will only take tightening actions if the inflation rate returns to or exceeds 4%

ChainCatcher news, according to Jinshi reports, the JPMorgan market team believes that inflation data is more likely to show signs of warming rather than cooling. Nevertheless, they think that this week's hotter data is unlikely to derail the risk appetite tone, and investors are also unlikely to fixate on a single data point, as there is one more CPI data release before the December Federal Reserve meeting.

However, the team reminds investors that Powell has shifted the Federal Reserve's focus from the labor market to weighing the dual mandate of employment and inflation. "If CPI and even retail sales data show a stronger economic growth trajectory while also stimulating inflation, then we need to pay attention to what might happen in the future."

In JPMorgan's view, investors are unlikely to shift to a cautious portfolio stance until they see the overall CPI year-on-year reaching 3.5% (which is a credible threat to the Federal Reserve). They believe that the Federal Reserve will only take tightening action if the inflation rate returns to or exceeds 4%.