Peter Andersen, chief investment officer of Andersen Capital Management, analyzes the latest employment and inflation data, the trajectory of the Fed interest rate, and how high oil prices are likely to rise.
Andersen Capital Management’s chief investment officer said oil prices could influence the Federal Reserve as policymakers decide the next step in interest rates.
“As Liz Peek recently said in an op-ed, this is going to put a speed bump in all of the Fed’s calculations,” CIO Peter Andersen said Monday on “Mornings with Maria.” Ta. “And when oil prices rise, certainly you will interpret that as inflation.”
of Opinion article written by Peek The one he was referring to was published by The Hill on Thursday.
An oil pump jack pumps oil in an oil field near Calgary, Alberta, Canada, on July 21, 2014. (Reuters/Todd Collor/File Photo/Reuters Photo)
On Monday afternoon, Brent crude oil traded at $90.64.
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Andersen told host Maria Bartiromo that it is “not an easy task” for the Fed to decide whether to lower, maintain or raise the benchmark interest rate.
He said “the prospect of higher oil prices” and other economic indicators, such as the recently released March jobs report, could complicate the U.S. central bank’s decision..
“I think we thought the Fed would be very accommodative after these incredible rate hikes, but it doesn’t seem to be very clear for the Fed,” he added. “Frankly, they’re going to be very frustrated over the next few weeks trying to figure out what the hell is going on with the economy.”
An eagle stands atop the facade of the Federal Reserve Board in Washington, D.C., July 31, 2013. (Reuters/Jonathan Ernst/Reuters Photo)
When the Federal Open Market Committee (FOMC) met in March, it announced its decision to keep the benchmark interest rate unchanged at 5.25% to 5.5%, the level it has been in since the summer. Federal Reserve policymakers also signaled late last month that they remain committed to cutting rates three times this year, although plans for lower rates may be pushed back further.
Fed says it is still planning three rate cuts and holds interest rates unchanged
In a statement in March, the FOMC said it was “strongly committed to returning inflation to its 2% target,” adding that it was “valuing a wide range of information, including labor market conditions, inflation pressures and expectations, and financial and international developments.” I will consider it.” development. ”
Regarding the stock market, Mr. Andersen said he is “trying to avoid the whole issue” of a rate cut “by focusing on stocks that may not be affected by the rate cut.”
He cited cybersecurity as an example of an “up and coming” industry, saying, “This is not going anywhere, and with some of the ransomware hacks being announced recently, it’s a great place to put your major to work. I think so,” he said. I currently have a position in my portfolio. ” He also mentioned artificial intelligence stocks.
Gas prices gradually rise amid rising oil prices due to rising tensions between Russia and Ukraine
His comments came ahead of Wednesday’s scheduled release of the latest Consumer Price Index (CPI) data by the Department of Labor’s Bureau of Labor Statistics. This information will be followed by the release of the Producer Price Index (PPI) on Thursday.
In February, the CPI inflation rate increased by 0.4% from the previous month, and overall by 3.2% from the previous year. Gasoline prices rose 3.8% from January, but fell 3.9% compared to the same month last year.
In this photo illustration, a gas pump refuels a vehicle at a Chevron gas station in Houston, Texas on December 5, 2022. U.S. gas prices are falling toward $3 a gallon, and global gas prices have been steadily falling since June. (Brandon Bell/Getty Images/Getty Images)
AAA reported Monday that the national average for a gallon of regular gasoline was $3.598.
Suzanne O’Halloran contributed to this report.
