Posted 1/20/2024, 4:00:00 PM
Sharp Drop in Inflation Sparks Optimism for Interest Rate Cuts, Potential Stock Market Rally
- Inflation fell by 4.5 percentage points in 2023, the largest single-year drop since 2009
- The last time inflation fell so rapidly in 2009, it kicked off a 9-year bull market in stocks
- The Fed is now predicted to cut interest rates 6 times in 2024 after inflation's sharp decline
- Falling interest rates could further boost economic growth and corporate earnings
- Historically, big drops in inflation lead to rallies in the stock market if the economy stays relatively stable