200-250 words only Review of two articles you have read in the Wall Street Journal ”WSJ” The articles must be related to investments, so please avoid general news articles, political news, culture ne
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Two articles review
U.S. Inflation Decelerated in August
By Paul Kiernan and Sarah Chaney
Sept. 27, 2019 9:25 am ET
summary
The decrease in inflation is as a result of lower prices for energy, food and durable goods. Increase of the core index (from 0.03% in July to 0.14% in August) which strips out volatile food and energy components is responsible for keeping the inflation below the Fed’s annual target of 2%. Underlying conditions are likely to increase the country’s inflation rate following its weak start to the year. Following brisk growth of worker’s wages, there is a likelihood of prices being pushed up.
Analysis
The authors make valid claims based on the current and previous data/information concerning inflation growth rates in the US economy. However, in reality, the condition seems to be different from the mere claims of decline in inflation rates because the available evidence on current high inflation is strong. With high wages, there is likelihood of injecting more cash into the economy, thus increasing prices of different products.
Bank of Mexico Lowers Interest Rates Again
By Anthony Harrup
Updated Sept. 26, 2019 4:07 pm ET
summary
The move to lower interest rates comes after inflation slows to the anticipated target of 3%. The bank cites reduction of headline inflation, the ample slack in the economy, and the recent behavior of the external and domestic yield as the main reasons for such decision. Lowe interest rates will promote the economy through lowering borrowing costs and improving exports.
Analysis
The author sounds realistic and practical, based on the evidence he provides with regards to how interest rates have caused inflation in the Mexican economy. However, the author does not cite more from other key players of the economy which are responsible for country’s low inflation rates. Therefore, this article is not reliable and cannot be used to make valid decisions since lower interest rates alone cannot decrease inflation rate in the economy.
