The points that the Fed in the United States has been concerned about are emerging. US PMI for May released today was 54.4 points, up from 51.3 points in April.
It has risen significantly. The 54.4 point is the highest level since April 2022. Despite the fact that the U.S. job market has shown signs of cooling since April, The fact that the PMI jumped 3.1 points in May is a significant change.
That’s why the U.S. stock market has plummeted today. The signs of inflation that the Fed was worried about are showing up in the market again. If this happens, a rate cut in the U.S. is expected to be possible only after September.
The mood is certainly different from Europe, which is planning a rate cut in June. Europe is determined to get its economy back on its feet, no matter how bad it is from inflation.
The situation seems to be a little different in the United States. Even if the period of major economic revival in the U.S. is pushed back a bit, let’s take inflation and go for it.
It’s not like the black-and-white logic of one side being right and the other being wrong is going to apply. It’s just a matter of which aspect of the economy is more important.
Whoever cuts interest rates first is likely to be in a better position for…
