Inflation seen as key to Fed policy.

Tomorrow marks the likely 10th 1/4 point increase in the Federal Funds rate since June 2004 and with the jobs report showing growth, an increase seems almost certain.

The Chinese currency [Yuan] was recently strengthened by 2%, which could reek havoc with the housing market if allowed to float as much as 40% to which would be needed to benefit the manufacturing sector. The US would see a competitive advantage in manufacturing, allowing prices to increase, placing upward pressure on rates, tempering activity in the housing sector.

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