American economic inflation influences the domestic
stock market
Continuously rising prices of gold and copper play a key role in fueling economic inflation all over the world, and American stock prices are facing difficulties. It also influences the domestic stock market due to rising prices of raw materials and soaring high oil prices.
It is reported that if falling prices on the American stock market continue, it will cause a burden of international inflation as time goes on. Therefore, experts working in domestic stock markets pay close attention to statements made by the Federal Open Market Committee (FOMC) regarding its flexible interest policy based on changes of economic indicators. According their view, it can result in ceaseless rising pressure on inflation.
Therefore, as along as America takes a look at inflation with care, there will be additional increases in interest rates and it will result in making global stock markets respond more sensitively in the last quarter of this year. A source from Daeshin Securities said, “Korea most depends on importing raw materials from all over the world and cannot avoid the inflationary trends. Since the influence of global stock prices spreads wider and wider, it will be difficult for the domestic stock market to avoid the global trend.
He said, “If price indicators to be announced by the US later this week do not mitigate worries about global inflation, there will be growing worries about increases in interest rates, sparking falling prices of stocks in the international financial market and increasing interest rates." Meanwhile, there is another view that even though increasing prices of raw materials on the world market will influence increases of the price index, some experts forecast consecutive growth of international economic markets. A source from Samsung Securities added, “There is no significant change yet regarding a close relationship between soaring prices of raw materials and increasing stock prices.”
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 / 입력시간: 2006. 05.16. 14:51
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