Why Things Changed
The economy saw a swift change predicted to increase the likelihood of a strong job market from now into next year. The brighter outlook was due to the decrease in the Consumer Price Index (CPI) and a significant boost to the stock and bond markets. The decline in the CPI and the potential for inflation stabilization led to investors' optimism. The Federal Reserve's approach to interest rates and inflation has been a critical factor in market movements. If inflation remains at current levels or decreases, the Fed may be able to leave interest rates unchanged, which is viewed positively by the market.
