Today, two Fed Governors confirmed what I wrote about on Friday. And that is, inflation is decelerating due to a reduction of housing costs and a shrinking labor market. The official Unemployment Report will come out this Friday. Last reading was 4.6%. Some think Friday’s number will be 4.5%, but I see a 4.7% number in the cards.
Then there’s Venezuela. The abduction/arrest/kidnapping/capture/??? of their President is being met with mixed reactions from other world leaders. From an economic perspective, the United States getting mixed up in any kind of conflict raises flags of uncertainty, which generally helps mortgage rates to go down.
One of the wild cards in this particular scenario is that Venezuela controls 17% of the world’s oil reserves, but for the last 40 years, have only been contributing 1% to the global circulation. Should drilling efforts improve in the country–and those stock piles released into circulation–the price of oil would come down, also easing in inflationary pressures.
