Local bankers on hopeful inflation news

A better-than-anticipated inflation report sent stocks up Thursday, Nov. 10, with the Dow Jones Industrial Average surging more than 1,200 points and two other major indices — Nasdaq and S&P — also posting gains. It was the Dow's best single-day performance since 2020.

Consumer price index showed inflation has risen 7.7% in 2022 through October, down from 8.2% in September and below analysts' estimates of 8%.

A series of interest rate hikes authorized by Federal Reserve Chairman Jerome Powell were initiated this year designed to cool inflation and bring it to a 2% level.

Local bank representatives were asked to weigh in on the developments.

Phil Moore,Banterra Bank

Clint Karnes,Wood & Huston Bank

Robbie Guard,MRV Banks

James P. Limbaugh,Montgomery Bank

• Phil Moore, Banterra Bank: It is possible (the hikes) are starting to have an impact but it is way too soon to know for sure if we are turning the corner, and we will probably be way into 2023 before we see a cooling. If energy prices do not come down, I feel it will be difficult for the Fed to control inflation moving forward.
• Clint Karnes, Wood & Huston Bank: The smaller-than-expected CPI was a welcome result. It does show the very large increases are starting to take hold. I think we will continue to see inflationary pressure over the next few months and we'll be well into next year before inflation returns to the Fed's 2% goal.
• Robbie Guard, MRV Banks: We haven't turned the corner yet and I believe we will continue to feel the effects of above normal inflation until the middle of next year. We are now just at the beginning of corporate layoffs from manufacturing facilities to corporate credit companies. I believe we will see another two rate hikes before mid-2023.
• Jim Limbaugh, Montgomery Bank: In the short term, expect inflation to remain high. The president said the day after last week's midterm elections we will not stop the policies of the past two years — signaling it really doesn't matter what the Fed does with massive government spending continuing to increase the federal deficit. Inflation is the most diabolical of all taxes and the most punitive on low-to-moderate income households. Increased prices on basic goods — e.g., gas, food, utilities — strips households of discretionary spending (and) also artificially increases wages, which suppliers and manufacturers have to pass along to consumers.

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