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Strategies & Market Trends : Bob Brinker, Moneytalk and Marketimer -- Ignore unavailable to you. Want to Upgrade?

To: Kirk © who wrote (1833)	12/10/2007 10:22:00 AM
From: alleeox	Read Replies (1) \| Respond to of 2121

Fed set to cut rates — mere days before an inflation report that could be hottest in years. Markets and the Fed will probably brush off the worrisome inflation news. For one thing, gasoline prices have settled down since the big run up in late October and early November. And core inflation should be comfortably low, probably rising just 0.2% for both the PPI and CPI. Higher energy prices are putting more stress on household budgets, but probably aren't fueling general inflationary pressures, economists said. "We see little price pressure at this time," wrote economists for Citigroup Global Markets. "We do not anticipate that higher energy costs will be passed through to underlying inflation." In fact, higher energy prices (and a slowing economy) will probably lead to less demand for other goods, Citigroup said, which would put downward pressure on core prices.