While the whole situation with the American Fed is unclear, and investors cannot give even 50 percent to the possibility of raising interest rates in September, the financial market is not so demanding.
Wells Fargo went up and gained 2.2 percent of income. As analysts believe today the financial indexes showed the best results among S&P 500 stocks.
This sector felt the influence of higher rates talks by climbing up. Investors expect that banks will double its income after they will charge bigger amounts for loans. Still, these calculations may be wrong, as fact as for this plan banks need to receive steeper yield curve, and for now, it is hardly possible.
If the short-term yields did not change much this Monday, the long-term went down quicker. It can be explained by the deeds of Fed. Many experts from the market believe that if the Fed will decide to tighten rates, the country falls down into the low inflation for a long time.
This Monday’s numbers showed that Federal Reserve decided that the best number of core inflation froze in 1.6 percent during the fifth month this year.
And the department of Fed in San Francisco has proclaimed that they do not really consider the inflation as the nearest futures. Still, they also sound very unsure about the hike for September, even though a lot of representatives from their department believe that it is the best option for the future of American economy.