The global economy is being shaken by fears of ‘price instability’ which erupted in the United States.
The US consumer price index rose more than 8% last month, and the New York stock market plunged on expectations of a rate hike.
Let’s find out by connecting the international newsroom. Reporter Lee Seung-hoon!
[기자]
This is Seunghoon Lee.
[앵커]
The New York Stock Exchange recorded its biggest decline in more than two years today, Let’s start with the US stock market.
[기자]
The Dow Jones Industrial Average on the New York Stock Exchange fell 3.94% from the battlefield.
Also, the S&P 500 fell 4.32 and the tech-focused Nasdaq fell 5.16%.
He literally collapsed. I can say that.
All three major indexes recorded their biggest daily declines in two years and three months since June 2020, the early stage of the COVID-19 pandemic.
Meanwhile, the New York Stock Exchange, which has been rebounding for the past 6 days, vomited all the gains for a week in one day.
Wall Street’s analysis is that today’s stock market downturn is very likely to continue for a while.
[앵커]
Let’s look at the consumer price situation in the US, which is the cause of this stock market crash.
Is inflation in the US worse than expected?
[기자]
The US consumer price index rose 8.3% from August last year.
Of course, it can be said that this figure is lower than 9.1% in June and 8.5% in July, but the forecast that experts had predicted so far was 8.0%.
That’s pretty funny.
As you said, it can be concluded that US inflation is more serious than expected.
Even in a situation where international oil prices, which have been the cause of price instability, have stabilized, these results are due to the fact that food and medical costs have risen a lot.
In particular, housing costs rose by 6.2% from August last year.
It went up a lot. Such increases in housing costs are said to have been rare since the early 1990s.
[앵커]
With these results, the Federal Reserve, the central bank of the United States, is talking about the possibility of raising the benchmark interest rate 0.75 percentage points, or even 1.0 percentage points?
[기자]
With the certainty of severe US inflation, expectations that the Fed could possibly slow rate hikes are no longer a bit achievable.
Now, the market is arguing that the Fed will take another ‘giant step’ at least 0.75 percentage points higher than the September rate hike.
Some experts are not even a huge step, but they even expect an increase of 1%p.
Because the best weapon against inflation is to increase employment, experts all agree that a big rate hike is inevitable.
[앵커]
Then let’s look at other news.
Tensions rise after another armed conflict between Azerbaijan and Armenia, who fought a war in 2020?
[기자]
The prime minister of Armenia says that 49 soldiers have been killed in the attack in Azerbaijan.
The Armenian Prime Minister announced this fact, saying that the Azerbaijani army is moving across the border and called the Russian and French presidents to ask for help.
This is what the Ministry of Defense of Azerbaijan had to say about this.
He claimed it was in response to Armenian provocation and that no civilians were attacked.
[앵커]
It is said that there is a reason why all the neighboring countries are nervous, saying that neighboring countries have been encouraged to refrain from using force in response to such military tensions.
[기자]
If you look at the place that issued a statement asking us to stop armed conflict, the European Union.
The French presidential office, a spokesman for the Turkish Ministry of Foreign Affairs, urged not even to fight the Kremlin.
Just by looking at the place where the statement was made, you can see that the relationship between the two countries is complicated.
First of all, both countries were called the Soviet Union together during the previous Soviet period. With the dissolution of the Soviet Union, the two countries bordered each other.
However, both countries have their own territories in the other’s lands due to the borders set for convenience.
It would be obvious to say that we live together in an uncomfortable way.
In the end, the conflict started, and there was a war in 2020.
Around 6,600 people have died in the ‘win and lose’ war.
If we go back to the war at that time, the countries that were most at odds with the conflict between the two countries were Russia and Turkey.
In the midst of the Ukraine war these days, Turkey is considered one of the countries with the best relations with Russia.
This is the international newsroom so far.
YTN Lee Seung-hoon (shoonyi@ytn.co.kr)
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