Weekly Talking Points for Financial Advisors (10/16/23)

Read the highlights of this week's commentary from Helios:

• Despite the recent strides in curtailing inflation, the September CPI and PPI both showed prices rose last month, largely attributed to higher energy costs. Shelter costs, which account for about a third of the total CPI, contributed to more than half of the monthly increase. For a decline in core inflation, steady moderation in the housing sector is essential.
• Amid inflation concerns, consumer sentiment dipped in October. The University of Michigan's October Consumer Sentiment Survey revealed a jump in median year-ahead inflation expectations to 3.8%, up from 3.2% last month, marking a five-month high. This comes on the heels of a 2.1% surge in gas prices in September.
• The ongoing Hamas-Israel conflict has impacted long-term interest rates, pushing the 10-year Treasury yield to 4.56%, a decrease from 4.80% the prior week. Yet, the unforeseen CPI uptick prompted a partial yield retracement.
• Bloomberg Economics cautions that the Israel-Hamas conflict could sway inflation and growth, potentially nudging the global economy toward recession. US Treasury Secretary Janet Yellen, however, remains optimistic about the economy's prospects, anticipating a soft landing despite Middle East tensions.