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<ul class="summary-list"><li>Inflation cooled in September, but less than economists expected.</li><li>The consumer price index increased 2.4% over the year, above the forecast of 2.3%.</li></ul>Inflation came in hotter than expected in September.The consumer price index, a closely-watched <a target="_blank" href="https://www.businessinsider.com/personal-finance/investing/what-is-inflation">inflation measure</a>, increased 2.4% from September 2023 to this past September. This index was expected to see a year-over-year increase of 2.3%, a cooler rate than <a target="_blank" href="https://www.businessinsider.com/inflation-august-consumer-price-index-federal-reserve-rate-cuts-2024-9">August's 2.5%</a>.The surprisingly hot inflation reading is a sign that the economy is running strong, and complicates the Fed's next rate decision, since in theory higher inflation would make further cuts less likely.Still, odds of a 25-basis-point rate cut at the central bank's November meeting ticked higher after the release, and now carries an 83% probability, according to the <a target="_blank" href="https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html">CME FedWatch</a> tool.That could be because the market also digested weekly jobless-claim figures that came in higher than expected. The Fed has been closely watching the labor market for signs of tightness, in addition to inflation for signals of what to do next with rates.Following a surprisingly <a target="_blank" class="" href="https://www.businessinsider.com/september-jobs-report-unemployment-rate-nonfarm-payroll-growth-federal-reserve-2024-10">strong September jobs report</a>, speculation rose that the Fed might slow its pace of rate cuts — or even <a target="_blank" class="" href="https://www.businessinsider.com/interest-rate-cuts-fed-outlook-recession-economy-stocks-ed-yardeni-2024-10">stop them altogether</a>. But the market appears largely convinced for now that a 25-basis-point move is coming in November.The Fed will have other data to mull over before the meeting. The Employment Cost Index, a quarterly release that shows how much companies are paying in salaries and benefits, will be published on October 31. Plus, the next jobs report, which includes how job gains looked in October as well as potential revisions for September's and August's growth, will be out on November 1.This is a developing story. Please check back for updates.

Inflation was hotter than expected in September, but continued its downward trend

<ul class="summary-list"><li>Indexes slipped Thursday as investors priced in a higher-than-expected inflation reading.</li><li>The data raises the possibility of a "no landing" scenario for the US economy.</li></ul>Stocks fell on Thursday from records reached in the previous session, as traders took in a sticky inflation reading for September. All three benchmark indexes fell, with the Dow Jones Industrial Average down TK points, a 0.40% fall, while the S&amp;P 500 and Nasdaq fell 0.% and 0.%, respectively.The declines follow rises across the board on Wednesday, which saw a fresh record close for both the S&amp;P 500 and the Dow, and comes after inflation proved stickier than expected last month. September consumer price index data released on Thursday showed inflation <a target="_blank" class="" href="https://www.businessinsider.com/inflation-september-cpi-consumer-price-index-federal-reserve-interest-rates-2024-10">rose 2.4% year-over-year</a>, slightly above consensus forecasts of a 2.3% rise.The core CPI reading, which excludes more volatile food and energy costs, was up 3.3% year-over-year and just above forecasts of 3.2%.The reading, coupled with last week's blockbuster jobs report, <a target="_blank" class="" href="https://www.businessinsider.com/us-economy-outlook-retail-sales-no-landing-inflation-jobs-report-2024-10">has sparked talk of a "no landing"</a> scenario for the US economy, a scenario in which strong economic growth fuels inflation and makes it harder for the Federal Reserve to cut rates. A no landing would likely mean rate cuts are fewer or slower than markets had previously forecast. It would also mean borrowers are saddled with higher interest rates on their debt for longer.After the CPI release, investors <a target="_blank" class="" href="https://markets.businessinsider.com/news/stocks/stock-market-outlook-volatility-cpi-inflation-september-jobs-report-bofa-2024-10?_gl=1*24ex3i*_ga*MTY3OTgyNjg0MS4xNzIxMDE2MDM2*_ga_E21CV80ZCZ*MTcyODU2NDg1Mi4yNTAuMS4xNzI4NTY1OTMzLjYwLjAuMA..">adjusted their expectations</a> for the Federal Reserve's easing cycle. The September jobs report had killed the odds of another big 50 basis point cut, but the slightly higher-than-expected CPI likely isn't enough to fully pump the brakes on Fed easing."Heading into the report, we thought only a very firm print would lead the Fed to consider pausing in November based on inflation alone. We did not get that," analysts from Bank of America said Thursday."While core PCE will be firmer than recent months, we think it will be enough for the Fed to follow through with a 25bp cut in November," they added.Investors are now pricing in higher odds of a 25 basis point rate cut at the central bank's meeting next month, according to the <a target="_blank" rel=" nofollow" class="" href="https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html?redirect=/trading/interest-rates/countdown-to-fomc.html">CME FedWatch Tool</a>.Meanwhile, weekly jobless claims edged up 33,000 to 258,000, according to Labor Department data released Thursday. That number marks its highest level in over a year and outpaced forecasts of 230,000.Here's where US indexes stood shortly after the closing bell on Thursday:<ul><li><a target="_blank" href="https://markets.businessinsider.com/index/s&amp;p_500?utm_source=markets&amp;utm_medium=ingest%3Futm_source%3Dmarkets&amp;utm_medium=ingest&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">S&amp;P 500</a>: 5,780.05, down 0.21% </li><li><a target="_blank" href="https://markets.businessinsider.com/index/dow_jones?utm_source=markets&amp;utm_medium=ingest%3Futm_source%3Dmarkets&amp;utm_medium=ingest&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">Dow Jones Industrial Average</a>: 42,454.12, down 0.14% (-57.88 points)</li><li><a target="_blank" href="https://markets.businessinsider.com/index/nasdaq_composite?utm_source=markets&amp;utm_medium=ingest%3Futm_source%3Dmarkets&amp;utm_medium=ingest&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">Nasdaq composite</a>: 18,282.05, down 0.05% </li></ul>Here's what else is going on:<ul><li>Inflation is scrambling Americans' <a target="_blank" class="" href="https://www.businessinsider.com/inflation-cost-of-living-what-is-middle-class-housing-market-2024-4">perceptions of middle-class life</a>, making the economy seem worse than it really is.</li><li>Insurance companies face massive losses, but catastrophe bond investors <a target="_blank" class="" href="https://markets.businessinsider.com/news/bonds/catastrophe-bond-investors-losses-unlikely-hurricane-milton-florida-reinsurance-helene-2024-10?_gl=1*3h318o*_ga*MTY3OTgyNjg0MS4xNzIxMDE2MDM2*_ga_E21CV80ZCZ*MTcyODU4NzA5Ny4yNTMuMS4xNzI4NTg5NzI4LjQyLjAuMA..">won't see huge damages</a> in the wake of Hurricane Milton.</li><li>Jamie Dimon says the "Buffett Rule" approach to taxing the wealthy could <a target="_blank" class="" href="https://www.businessinsider.com/jamie-dimon-us-debt-unsustainable-higher-taxes-buffett-rule-millionaires-2024-8">solve America's debt problem</a>.</li></ul>In commodities, bonds, and crypto:<ul><li>Oil futures rose. <a target="_blank" class="" href="https://markets.businessinsider.com/commodities/oil-price?type=wti">West Texas Intermediate crude</a> rose 3.7% to $75.93 a barrel. <a target="_blank" href="https://markets.businessinsider.com/commodities/oil-price?utm_medium=ingest&amp;utm_source=markets">Brent crude</a>, the international benchmark, climbed 3.7% to $79.44 a barrel.</li><li><a target="_blank" href="https://markets.businessinsider.com/commodities/gold-price?utm_medium=ingest&amp;utm_source=markets">Gold</a> rose 0.8% to $2,646.7 an ounce.</li><li>The 10-year Treasury yield was about flat at 4.07%.</li><li><a target="_blank" class="" href="https://markets.businessinsider.com/currencies/btc-usd">Bitcoin</a> fell 2% to $59,654.</li></ul>

Stock market today: Indexes close lower after CPI shows sticky inflation in September

<ul class="summary-list"><li>A blockbuster jobs report raises the stakes for upcoming inflation data, BofA analysts say.</li><li>The analyst predicted that an upside surprise to September CPI would stoke fresh volatility. </li></ul>The September jobs report was good news, but it gives investors more reason to brace for the next inflation reading, Bank of America analysts say.The analysts say last week's blockbuster jobs report puts more pressure on this week's consumer price index data, with a big surprise to the upside now more likely to usher in a wave of market volatility. They say the CPI reading, due Thursday, is "no longer a 'non-event.'""Following the blowout jobs report last Friday, we believe the importance of CPI this week has risen," the analysts said in a Sunday note. "A sizeable surprise could bring uncertainty on the easing cycle and more volatility into the market."They note that options are pricing in a 109 basis point move, or a little over 1%, in the S&amp;P 500 on Thursday when CPI is released, compared to forecasts of a 91 basis point move last week. That would surpass the three-month average of a 70 basis point move on the day of a CPI release, and a move of that size would be the largest swing tied to a CPI report since May.On the bright side, the analysts say that stocks can withstand a slight upside surprise if it is tied to strong macro data. "Good news is good news for stocks as long as inflation doesn't flare up again," the analysts said, adding that historically, stocks and rates have moved higher when inflation moves lower, and lower when inflation follows an upward trajectory.Economists forecast the CPI report will show inflation continued to cool last month, rising 2.3% year-over-year compared to 2.5% in August.As inflation has edged back toward the Fed's 2% target, the central bank has grown increasingly focused on the labor market after years of fighting inflation. That <a target="_blank" href="https://www.businessinsider.com/fed-rate-cut-explained-inflation-labor-market-conditions-outlook-recession-2024-9">pivot</a> was behind the central bank's decision to deliver a jumbo 50 basis point rate cut last month, the first cut in four years. However, with the blockbuster September jobs report, some economists say <a target="_blank" href="https://www.businessinsider.com/inflation-outlook-fed-interest-rate-cuts-jobs-report-us-economy-2024-10">inflation is still a concern.</a> If this week's CPI data surprises to the upside, the Fed could be forced to turn its attention back toward pricing pressures in the economy. "CPI for September will be a key data release. If prices rise faster than expected on top of the stronger labor data, chances for the Fed to skip the November meeting will increase," UBS economist Brian Rose said in a Friday note.The odds of a 50 basis point rate cut from the Fed next month <a target="_blank" href="https://www.businessinsider.com/september-jobs-report-fed-rate-cut-outlook-november-labor-market-2024-10">slipped</a> from 33% to zero following the release of the September jobs report, according to the <a target="_blank" href="https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html?redirect=/trading/interest-rates/countdown-to-fomc.html">CME FedWatch tool</a>. Thursday's CPI reading will thus be a key indicator as investors anticipate the Fed's next move.The <a target="_blank" href="https://www.businessinsider.com/september-jobs-report-unemployment-rate-nonfarm-payroll-growth-federal-reserve-2024-10">September jobs report</a> blew past forecasts, with 254,000 nonfarm payrolls added compared to expectations of 150,000. The unemployment rate dipped from 4.2% to 4.1%.

Brace for stock-market volatility this week if inflation comes in hot after the September jobs report, BofA says

<ul class="summary-list"><li>Inflation accelerated as expected in October.</li><li>The consumer price index increased 2.6% from October 2023, matching the forecast.</li></ul>As expected by economic forecasters, inflation heated up in October.The consumer price index sped up as expected to a 2.6% year-over-year growth rate in October from <a target="_blank" class="" href="https://www.businessinsider.com/inflation-september-cpi-consumer-price-index-federal-reserve-interest-rates-2024-10">September's rate of 2.4%</a>.Inflation had been cooling down for most of 2024. Before the latest reading, the last uptick in the headline year-over-year rate was in March.Core CPI, which excludes volatile food and energy prices, rose 3.3% in October from a year ago, matching the forecast and the previous year-over-year increase.The Federal Reserve will likely want to see signs of inflation continuing to come down to its 2% target as Federal Open Market Committee members decide whether to continue cutting interest rates. There are still a lot of data releases to come out before the year's final scheduled FOMC meeting in December, including further reports for inflation measures like the CPI.The Fed decided in its November meeting to <a target="_blank" class="" href="https://www.businessinsider.com/federal-reserve-cuts-interest-rates-quarter-point-powell-inflation-election-2024-11">cut interest rates by 25 basis points</a>, which was largely expected and smaller than <a target="_blank" class="" href="https://www.businessinsider.com/fed-cuts-interest-rates-how-much-september-fomc-powell-inflation-2024-9">September's 50-basis-point cut</a>.Before the latest CPI report, <a target="_blank" class="" href="https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html">CME FedWatch</a> showed investors were assigning around a 60% probability to a 25-basis-point cut in December. After the CPI news release, that increased to around 70%.November's jobs report, to be published in early December, will also help Americans and the Fed better understand the labor market in the fall after employment readings in <a target="_blank" class="" href="https://www.businessinsider.com/october-jobs-report-unemployment-rate-nonfarm-payroll-growth-federal-reserve-2024-11">October</a> were surprisingly weak amid hurricanes and strikes."We're trying to be on a middle path where we can maintain the strength in the labor market while also enabling further progress on inflation," Fed chair Jerome Powell said at a press conference on November 7.This is a developing story. Please check back for updates.

Inflation heated up in October as expected

<div type="image" title="In case RBI is in the mood to hike the interest, your home loan EMIs might end up taking more from your pockets. Or, if it leaves the rates unchanged, your EMIs wont budge one bit" msid="114284206" hostid="261" caption="&amp;lt;p&amp;gt;In case RBI is in the mood to hike the interest, your home loan EMIs might end up taking more from your pockets. Or, if it leaves the rates unchanged, your EMIs wont budge one bit&amp;lt;/p&amp;gt;"></div> On September 18, 2024, the <keyword id="19951097" type="General" weightage="20" keywordseo="us-fed" source="keywords">US Fed</keyword> delivered a jumbo-sized surprise to the global economy. Not only did they trim their interest rates by a massive 50 basis points to bring their yields down to 5%, but also hinted at further rate cuts in the upcoming months. This move from the fed and several other central banks globally had pushed expectations high for a similar rate slash closer home, from the <keyword id="19899808" type="General" weightage="100" keywordseo="rbi" source="keywords">RBI</keyword> this month. But governor <keyword id="19913110" type="General" weightage="20" keywordseo="shaktikanta-das" source="keywords">Shaktikanta Das</keyword>, in a “picture abhi baaki hai” moment, decided to hold the repo rates here steady, leaving them unchanged at 6.5% for the record 10th straight time. Although, he did tinker with the policy stand, changing it from “rate cuts are absolutely off the table” to a more accommodating “we’re okay with bringing down the rates, if needed”. This, rather neutral, stance from India’s financial custodian sparked hopes for a rate cut in December this year. However, the stubborn <keyword id="22195" type="General" weightage="20" keywordseo="inflation" source="Orion">inflation</keyword> levels in September have again dented such hopes. As consumers, you may be wondering what all the hullabaloo this is about, since it hardly makes a difference to your regular financial routine. Well, the majority of both economic growth and inflation is closely connected to this policy stance from the central bank and it does have a rather indirect effect on both our earnings and spending. But more directly, it would have clear implications for those looking to own a house. Even the slightest modification of interest rates, or the lack of it, influences the <keyword id="19916018" type="General" weightage="20" keywordseo="emi" source="keywords">EMI</keyword> you pay significantly. So, all aspiring homebuyers, is this the right time to take out a loan and buy a house? Can you expect a rate cut anytime soon, and what will that mean for your home-owning dreams? We lay it out. <h2>What’s the connection?</h2>You see, buying a house is no small feat, at least financially. The task becomes even more herculean if you are scouting for your own roof in cities like Delhi, Noida, Bangalore or Mumbai where, as Circuit from Munnabhai says, “room shuru hote hi khatam ho jata hai”. Naturally, you’ll have to take a <keyword id="6354730" type="General" weightage="20" keywordseo="Home-loan" source="Orion">home loan</keyword> from the bank. Don’t be mistaken, the bank won't give you a loan that covers 100% of the value of the property you want to own. Rather, your loan amount will be equivalent to a certain percentage of the property’s total value. RBI’s guidelines on this are pretty clear: <ul><li>If your loan amount is up to Rs 30 lakh, you can get a loan worth 90% of the property’s value.</li></ul><ul><li>If the loan amount is between Rs 30 lakh and Rs 75 lakh, you are eligible for a loan worth 80% of the property’s value. </li><li>If you are taking a loan of more than Rs 75 lakh, your loan amount will be equivalent to 70% of the property’s value. </li></ul>Now assuming that you have the money, it's all about paying back the principal amount, but not without a little (read hefty) interest added on top. See, when you’re taking a home loan, you are actually signing up for a long-term, even multi-decadal financial commitment, which will unfailingly present itself to your bank accounts and finances every single month, in the form of EMIs, or equated monthly instalments). When you take a home loan, you can choose to pay the interest in two ways (talk about choices!). One is that you decide to keep a fixed rate of interest throughout the tenure of your home loan. So, if you opt for a 25-year fixed-rate home loan at the rate of 8.8% p.a., you’ll have to pay interest at this rate for the next 25 years, till your entire loan is paid off. Yes, you can go backsies and switch to a floating-rate home loan by paying a fee. Floating, as the name suggests, means that your interest rate is not set in stone. But starting October 2019, when it comes to a floating interest rate home loan, your payable interest and EMIs are directly impacted by any changes in <keyword id="20094323" type="General" weightage="20" keywordseo="repo-rate" source="keywords">repo rate</keyword>, which were left unchanged by RBI this time around. Why are these two so chummy, you might ask. Well, <keyword id="173069" type="General" weightage="20" keywordseo="Home-loan-interest" source="Orion">home loan interest</keyword> rates are a sum of two things: <ol><li>Repo Rate (the rate at which RBI lends money to banks)</li><li>Operational cost + margins</li></ol>Any plus or minus in this equation would send your home loan interests tanking, or skyrocketing. Vivek Iyer, Partner, Grant Thornton Bharat explains that any change in the repo rates impacts the cost of funds and thereby the home loan interest rates. “When the interest rates are expected to reduce, the corresponding impact will be in the form of a reduced EMI. Home loan borrowers should always try to borrow at a floating rate when interest rates are expected to reduce and at a fixed rate when the interest rates are expected to increase. This minimizes the outflow in the form of EMIs that the home loan borrowers will experience”, he continues. So, no change in repo rates means no change in your home loan interest payout and no financial relief whatsoever. A rate cut, which most experts are anticipating will start this December, would mean your EMI payments come down, and your wallet might save a little more. But there’s also a chance of an UNO reverse happening. In case RBI is in the mood to hike the interest, your home loan EMIs might end up taking more from your pockets. Consider this. You took a floating interest rate home loan worth Rs 50 lakh in January 2022 at 8% p.a., for a period of 20 years. This brings your total monthly EMI to Rs Rs 41,822. But, as luck would (or won't) have it, RBI raised the interest rate by 250 basis points between May 2022 and February 2023, bringing it to its current status of 6.5%. Some back-of-the-envelope calculations suggest that now, your home loan interest payout will also rise by a hefty 2.5%, taking the total to 10.5%. In other words, you’ll have to dish out Rs 49,919 per month as EMI. Now, won't you heave a sigh of relief if the RBI were to bring down the interest rate by say, even 50 basis points, or 0.5%? Agreed, your EMI will come down just marginally, to Rs 48,251. But look at this over a 20-year period, and you’ll see how big the difference is. <h2>Are rates set to change anytime soon?</h2>Generally, RBI hikes the repo rates if it sees inflation spiralling out of control. Then, in a bid to reduce consumer spending, it raises interest rates to make borrowing expensive. But when the apex bank sees sluggish consumption in the economy, inflation in control and wants to boost spending, it slashes down on interest rates, making it more lucrative for people to borrow. As of now, most experts are not anticipating any changes in the interest rates anytime soon. This means home loans are not getting cheaper anytime soon. The CPI data, which came out yesterday, saw inflation rise to 5.49% in September, compared to 3.65% last month. Food and beverage prices jumped to a four-month high of 8.36% in September, as opposed to a 5.3% rise in August. So a rate cut seems a no-go at the moment! Apurva Sheth, Head of Market Perspectives and Research, SAMCO Securities explains that the RBI had probably expected a hardening of inflation and that's why it chose to hold on to the rates in the monetary policy announcement last week. “Now, it seems that RBI will take a cautious stance going ahead and will not be in a hurry into rate cuts like its global peers”, he added. In all this, one thing is clear, in the grand movie of the Indian economy, the RBI has chosen stability over drama. And just like in every good Bollywood film, we're left wondering what twist the sequel will bring. Until then, it might be “The End" for rate cuts, but the show must go on for the Indian economy!

Simply Put: Boom or bust — how RBI’s decision to leave rates unchanged affects homebuyers

<div type="image" title="Save yourself the trouble of buying physical gold this Diwali, and instead, go digital with Gold ETFs!" height="900" width="1200" msid="114507055" hostid="261" sizebytes="439216" caption="&amp;lt;p&amp;gt;Save yourself the trouble of buying physical gold this Diwali, and instead, go digital with Gold ETFs!&amp;lt;/p&amp;gt;"></div> Ah, <keyword id="18712" type="General" weightage="20" keywordseo="Gold" source="Orion">gold</keyword>! The shiny metal that's been making humans lose their minds since time immemorial. And yet, from <keyword id="23657519" type="General" weightage="20" keywordseo="king-midas" source="keywords">King Midas</keyword> to our neighbourhood aunty and even our moms (and secretly dads), everyone seems to have a super soft spot for the <keyword id="6384667" type="General" weightage="20" keywordseo="Bullion" source="Orion">bullion</keyword>. But here's the kicker: right now, gold prices are breaking all records on their upward trajectory! As of today, prices of 24k carat gold have passed the Rs 80,000 mark per 10 grams. And if experts are to be believed, this train isn't stopping anytime soon! So, as shiny as gold might look, adding even a bit of its glitter as we start decking up for the festive season might not be so easy on your pockets. But let's admit it—we love our gold and can't live without it. No wonder India is the second-largest consumer of the yellow metal in the world, only behind China. Such is our fondness for the metal that the <keyword id="20195223" type="General" weightage="20" keywordseo="world-gold-council" source="keywords">World Gold Council</keyword> had to up our 2024 annual demand forecast to 850 tonnes, up from the previously estimated 750 tonnes. However, our love for gold isn't just about looking fabulously embellished and blinding people with its bling. Indians also see gold as a long-term, trusty investment, supporting our other hard-earned assets, especially when high <keyword id="22195" type="General" weightage="20" keywordseo="Inflation" source="Orion">inflation</keyword> rates pull our returns down. After all, while inflationary pressures generally weaken the purchasing power of our regular paper money, gold is built differently. When the world is buckling to inflation, gold gains value during these times. This is also why it is considered a solid hedge against inflation. With <keyword id="188" type="General" weightage="20" keywordseo="Diwali" source="Orion">Diwali</keyword> and <keyword id="4067" type="General" weightage="20" keywordseo="Dhanteras" source="Orion">Dhanteras</keyword> knocking at our doors, the inflation demon continued to bother India like a guest who refused to leave. Just last month, the Consumer Price Index (CPI) stood at 5.49%, much higher than the anticipated levels. Moreover, the diverging policy stances among central bankers worldwide, growing geopolitical tensions, tough job markets, and extreme weather events are only adding to the uncertainty. In such economically uncertain times, what should your gold strategy be this festive season? To buy or not to buy, that is the question. Well, let’s get to it. <h2><keyword id="20050894" type="General" weightage="100" keywordseo="gold-etfs" source="keywords">Gold ETFs</keyword> to the rescue</h2>See, buying physical gold jewellery is certainly a flex, but also a financial fuss. First, you pay a heavy amount to buy gold. Not to mention all those extra, hefty jewellery-making charges. And then you pay even more money to keep it safe in a bank locker, lest it get stolen. But what if we tell you that you can own pure 24k gold, minus all these frills? Welcome, Gold ETFs (Exchange Traded Funds). Simply put, gold ETFs are like the cool cousins of your traditional gold investments. Instead of stashing gold bars under your mattress like those maniac millionaires we see in Bollywood films, you can now invest and trade in gold through the stock market. It's basically buying units of an <keyword id="19930506" type="General" weightage="20" keywordseo="etf" source="keywords">ETF</keyword> on the stock exchange that directly mirror the ongoing domestic prices of gold. Generally, gold ETFs are equivalent to 99.5% pure physical gold bars, and each ETF unit denotes actual, one gram of gold. And let's face it, who would not want that golden glow in their lives? Gold ETFs have witnessed an over seven-fold surge in their AUM (assets under management) in just the last five years. From Rs 5,613.22 crore in September 2019 to Rs 39,823.50 crore in September 2024, gold ETFs seem to be in-thing. Inflows in gold ETFs have shot up by a whopping 2,695% over the last 5 years. In September 2019, gold ETFs had garnered a mere Rs 44.11 crore. Compare that to the inflows worth Rs 1,232.99 crore gold ETFs received last month. Talk about growing, or glowing popularity! In fact, in just 2024, inflows in gold ETFs have surged by nearly 88% since the beginning of this calendar year. From Rs 657.46 crore in January 2024 to Rs 1,232.99 crore in September 2024, good old gold is never out of season. <h2>So, how do these ETFs work? Should I invest in them now?</h2>All you need is a Demat account. Log into your account, choose the gold ETF scheme you want to invest in, and voila! You’re now a bullion-aire! All your gold ETF units will be stored in this account. Then, you can buy and sell gold ETFs just like you buy shares—in real-time. So, if gold prices inch upwards, which is where gold is currently going, the value of your ETF units will also rise in lockstep. Ashwini Kumar, Senior Vice President and Head of Market Data at ICRA Analytics, says that of late, gold ETFs have been increasingly gaining popularity among investors due to the liquidity, safety and transparency they offer. "With the escalating global geopolitical tensions boosting the ‘safe-haven’ appeal of the bullion, investors are preferring to park their funds in gold ETFs as compared to investing in physical gold, as there is no hassle of storing it. The heightened activity in gold ETFs is also driven by the prospects of an imminent further interest rate cut by the <keyword id="20078761" type="General" weightage="20" keywordseo="u-s-federal-reserve" source="keywords">U.S. Federal Reserve</keyword> in the coming months,” he added. “Investors with a short- to medium-term investment horizon may consider investment through gold ETFs. A buy-on-dips strategy here may help investors capitalise on a temporary correction in prices. Also, given the current market dynamics where equities are showing mixed trends, a modest, 5-10% allocation to gold may serve as a hedge against inflation and market volatility, which may help you balance risks in an optimum manner,” Kumar noted. <h2>Wait, there is no dearth of options</h2>But if ETFs make you go WTF, there’s always digital gold. You can invest in the yellow metal without actually physically holding it for as low as Rs 1. The best part? You can buy or sell this gold 24 X7 seamlessly via multiple apps without having to pay storage costs. On your behalf, your gold is stored in insured vaults by the seller. But remember, digital gold continues to remain unregulated territory in the country, where you venture at your own risk. In 2021, market watchdog SEBI had even asked its members to desist from selling digital gold. Then there are gold mutual funds and the Sarkari SGBs, or sovereign gold bonds. While gold mutual funds invest primarily in gold ETFs, SGBs are issued by the RBI and are also a reliable substitute for holding physical gold. However, with the RBI currently putting brakes on issuing SGBs, investing in them is out of the question. Plus, you should only get your hands on SGBs if you're in for the long haul. Apart from a 2.5% p.a. interest, you don't have any yearly earnings from them. Moreover, no premature redemption is allowed before 5 years, and you'll have to wait a good 8 years to maximise your returns. <h2>Okay, tell me about returns</h2>In contrast, the seventeen gold ETF schemes currently present in the market offer an average one-year return of 29.12%. Stay with it a little longer, and you can end up with returns worth 16.93% and 13.59% over a 3- and 5-year period, respectively. If you look at it, these returns are comparable with the returns delivered by actual, physical gold. Data from Value Research indicates that gold, as a commodity, has delivered returns worth 27.24%, 16.53%, and 14.18% over a 1, 3, and 5-year period, respectively. So, worth investing, right? <h2>What are the risks?</h2>See, markets are as unpredictable as monsoons in Mumbai. One significant market correction can wash away your returns, and one sunny day or an upswing can leave you wallowing in wealth. Since your gold investments are directly linked to these markets, you should steel yourself up for some volatility. Plus, international gold prices are in dollars. So, if our rupee decides to take a nosedive, your returns might look a bit tarnished. Also, know that your ETF might not always perfectly mirror gold prices, which is also known as a tracking error. It's like expecting your Zomato-ordered food to look exactly like the picture on the menu—it's close, but not quite. Then there’s the taxation bit. The budget this year brought down the LTCG (long-term capital gains tax) on gold ETFs from the previous 20% to 12.5% (sans indexation). LTCG is what you pay if you sell your ETF units after 12 months. If you sell your gold ETF units within a year and make handsome returns, the tax you’ll have to pay will be equivalent to your income tax slab rate. <h2>Is gold just for old?</h2>A survey by fintech firm Moneyview thinks otherwise. Per their findings, over 85% of the 3,000 respondents it talked to considered gold to be a valuable asset for wealth preservation, with its intrinsic value and historical performance continuing to drive consumer confidence. Particularly, young investors in the age group of 25–40 years are also investing in gold via both physical and digital ways to build wealth for retirement and other long-term goals. So, young or old, everyone’s going for gold. So, this festive season, with gold prices going north, investing in gold can add that much-needed glitz to your financial attire. But remember, don't go overboard since gold isn't exactly a high-return-yielding asset. But whether you're a seasoned investor looking to diversify or a newbie trying to make their way in the markets, investing in gold offers you a glittering safety cushion. Just remember, while gold can make your portfolio shine, it's your smart investment decisions that truly make you golden. Disclaimer: The content on this website is for informational purposes only and should not be construed as investment advice. We recommend readers consult certified, qualified, and registered advisors for professional and personalised financial advice.

Simply put: Can investing in gold this festive season add the much-touted Midas touch to your investments?

India's GDP growth is projected at 7.2 per cent in 2024-25, around 7 per cent in the next fiscal, and after that, there is a strong likelihood that the growth will revert to the 8 per cent trend, said <keyword id="19899810" type="General" weightage="20" keywordseo="Reserve-Bank-of-India" source="keywords" meta.keywordsubtype="org" meta.entityname="Reserve Bank of India" meta.hostid="261" meta.entityid="Reserve Bank of India">Reserve Bank of India</keyword> deputy governor <keyword id="20244361" type="General" weightage="20" keywordseo="Michael-Debabrata-Patra" source="keywords">Michael Debabrata Patra</keyword>. He was speaking at the New York Fed Central Banking Seminar organised by the <keyword id="20238413" type="General" weightage="20" keywordseo="Federal-Reserve-Bank" source="keywords" meta.keywordsubtype="org" meta.entityname="Federal Reserve Bank" meta.hostid="261" meta.entityid="Federal Reserve Bank">Federal Reserve Bank</keyword> here on Monday. "...I do believe with all the strength of my conviction that India's time has come," he said, and highlighted the country heads into its future with the youngest population in the world with a median age of 28 years. Unlike in many parts of the world, the working age population is growing -- every sixth working age person is an Indian. Patra said that since independence in 1947, India's growth path has undergone three structural shifts with trend growth, having risen to 7 per cent during 2002-2019. After the severe contraction during the pandemic, a new growth trajectory averaging 8 per cent seems to be forming during 2021-24, he said. India is now regarded as the fastest growing major economy in the world. Already the fifth largest economy in terms of market exchange rates, it is poised to become the third largest economy by 2030, the senior RBI official said and added the country is already the third largest economy in terms of <keyword id="20776921" type="General" weightage="20" keywordseo="purchasing-power-parity" source="keywords">purchasing power parity</keyword>. "Our projections show that India's <keyword id="21013593" type="General" weightage="20" keywordseo="real-GDP-growth" source="keywords">real GDP growth</keyword> will be 7.2 per cent in 2024-25 and around 7.0 per cent in 2025-26 in a cyclical correction to the rebound from the pandemic. Thereafter, there is a strong likelihood that India's growth will revert to the 8 per cent trend," Patra said. On inflation, he said it is projected to average 4.5 per cent in 2024-25 and 4.1 per cent in 2025-26. Consumer Price Index (CPI) based inflation fell below target during July-August but rose to 5.5 per cent in September on the back of a pickup in price momentum in some food items and adverse base effects inherent in year-on-year measurement. "Our projection indicates that these price pressures will persist in October and November before headline inflation realigns with the target from December 2024 and remains aligned in 2025-26," the deputy governor said. He also emphasised that India is emerging as a world leader in leveraging <keyword id="20181895" type="General" weightage="20" keywordseo="digital-technologies" source="keywords">digital technologies</keyword> for transformative change.

India likely to grow at 7.2% in FY25, says RBI deputy governor

<ul class="summary-list"><li><a target="_blank" class="" href="https://www.businessinsider.com/personal-finance/investing/what-is-inflation">Inflation's</a> downtrend may not be as straightforward as some investors think, according to Charles Schwab.</li><li>The brokerage firm pointed to elements that could push prices higher, like Trump's tariffs and tax cuts.</li></ul>The Fed's mission to lower consumer prices could soon face some snags — and there are a handful of signs investors should be watching out for to determine if prices are on the rise again, according to Charles Schwab.Strategists at the brokerage firm expect a "choppy" downward path for inflation, despite the fact that overall inflation in the US is cooling. In a new research note, the firm cited a number of pressures in the economy that could buck the disinflation trend and send prices back higher."We think inflation will continue to trend lower, but there are a few potential risks on the horizon, including Federal Reserve interest rate cuts, stronger-than-expected economic growth in recent months, and policy proposals by incoming US President Donald Trump," strategists wrote, pointing to the president-elect's plan to levy <a target="_blank" class="" href="https://www.businessinsider.com/how-trump-tariffs-will-impact-prices-technology-clothes-appliances-furniture-2024-11">tariffs</a> on US imports, <a target="_blank" class="" href="https://www.businessinsider.com/tax-cut-tariff-plan-outlook-presidential-election-scenarios-harris-trump-2024-10">cut taxes</a>, and potentially lower the supply of labor by <a target="_blank" class="" href="https://www.businessinsider.com/trump-harris-immigration-jobs-arizona-economy-mass-deportation-employment-wages-2024-10">restricting immigration</a>."<a target="_blank" class="" href="https://www.businessinsider.com/trump-tariffs-higher-inflation-fed-interest-rates-taxes-mortgage-rates-2024-11">Tariffs</a> tend to act as a one-time price increase as the costs are passed from importing companies to consumers. Similarly, tax cuts have been proposed that could provide more stimulus to an economy already growing at a healthy pace. Immigration reform could mean higher labor costs," the note added.Trump has pushed back on the notion that his economic plan is inflationary, and said he would lower prices for Americans during his second term. He levied tariffs during his first term as president without a significant inflation surge, but experts say the tariffs Trump would impose this time around are far more wide-sweeping, explaining the difference in inflation forecasts.Meanwhile, the Fed may already be facing some resistance in its goal to get <a target="_blank" class="" href="https://www.businessinsider.com/inflation-october-cpi-consumer-price-index-federal-reserve-interest-rates-2024-11">inflation</a> back down to 2%. Prices rose 2.6% year-per-year in October, in-line with what economists had expected, but hotter than the prior month's 2.4% increase, according to the Bureau of Labor Statistics."Looking forward, though, it's worth assessing potential risks to disinflation," Schwab added.Strategists flagged four things in markets that could signal if inflationary pressures in the economy are picking up:<h2 id="41d73f46-2e9d-46d7-89ba-4c38f91b2650">1. Labor costs rising</h2>Labor costs have accelerated in recent months, with unit <a target="_blank" class="" href="https://fred.stlouisfed.org/series/ULCNFB">labor costs</a> among all workers in the business sector rising to 3.4% year-over-year in the third quarter, according to Federal Reserve data.<div type="image" title="Chart showing unit labor costs" height="1240" width="1420" msid="115383807" hostid="261" sizebytes="47210"></div>Higher wages are considered <a target="_blank" class="" href="https://www.businessinsider.com/personal-finance/investing/what-causes-inflation#:~:text=When%20people%20anticipate%20higher%20inflation,as%20a%20wage%2Dprice%20spiral.">inflationary</a>, as they raise costs for businesses and could lead firms to hike prices, a dynamic known as a <a target="_blank" class="" href="https://www.businessinsider.com/salary-negotiations-inflation-expectations-economy-2022-11">wage-price spiral</a>."It's too soon to say whether that uptrend will continue, but if labor supply is restricted and ends up putting upward pressure on wages, faster unit labor cost growth could unleash further momentum in inflation," Schwab strategists said.<h2 id="3bc506f7-2207-403b-a65c-f253e9941afb">2. The relationship between stocks and bonds</h2>Stocks typically move opposite to <a target="_blank" class="" href="https://www.businessinsider.com/personal-finance/investing/bond-yield">bond yields</a>, as higher interest rate expectations priced into the bond market would be bearish for equity prices.The rolling 120-day correlation between the <a target="_blank" class="" href="https://markets.businessinsider.com/index/s&amp;p_500">S&amp;P 500</a> and the yield on the benchmark <a target="_blank" class="" href="https://markets.businessinsider.com/rates/u-s--rates-10-years">10-year US Treasury</a> has ticked into positive territory, which means stocks and yields are rising in tandem due to expectations of strong economic growth.If the correlation moves back into negative territory, that could signal greater concern over inflation in the economy, strategists said.<div type="image" title="Chart showing stock and bond yield correlation" height="1241" width="1656" msid="115383805" hostid="261" sizebytes="46810"></div>"If the correlation flips back into negative territory, though, that would be consistent with inflation (again) being the main driver of downside risk for stocks," the firm wrote. "It's too soon to say that will be the case, but the risk is worth monitoring as we start to turn the corner into 2025."<h2 id="52c75ff6-d092-4b23-9c06-94ea3840e795">3. Rising Treasury yields</h2><a target="_blank" class="" href="https://markets.businessinsider.com/news/stocks/trump-trade-us-presidential-election-dollar-treasuries-stocks-crypto-djt-2024-11">Yields</a> have been climbing ever since Trump secured his second-term in office, with the 10-year yield surpassing 4.4% the day after the vote, its highest level since early July.<div type="image" title="Chart showing 10-year US Treasury yield" height="1064" width="1283" msid="115383804" hostid="261" sizebytes="33954"></div>The increase is reflective of higher interest-rate expectations in the market, a sign that investors are concerned about future inflationary pressures."Concerns about a rebound in inflation on the back of stronger-than-expected economic growth since September, and the potential for expansive fiscal policy are the major drivers. Markets are beginning to dial back expectations for further rate cuts in response to inflation concerns," Schwab strategists said.<h2 id="1a1f6685-af6f-424d-abf4-e9e18ac4ef79">4. Economic momentum is building.</h2>The economy looks to be growing stronger than investors expected — another factor that could fuel inflation. The <a target="_blank" class="" href="https://www.businessinsider.com/citi-economic-surprise-index-2013-12">Citi Economic Surprise Index</a> has soared in recent months, climbing from a level of around -50 this summer to 40 as of November.<div type="image" title="Chart showing Citi Economic Surprise Index against 10-year yield" height="939" width="1626" msid="115383808" hostid="261" sizebytes="65916"></div>"Stronger growth suggests that the Fed may not lower short-term rates as much as anticipated just a few months ago. Adding to the shift in the view of Fed rate path is the likelihood of higher inflation under proposed policies from the incoming administration," strategists said."We expect the Federal Reserve to continue with rate cuts over the next few months if inflation continues to trend lower. However, we are assuming a slower and shallower path of rate cuts in 2025 than we did just a month ago," they continued.Expectations for <a target="_blank" class="" href="https://markets.businessinsider.com/news/stocks/stock-market-today-fed-powell-comments-rate-cut-odds-rally-2024-11">Fed rate cuts</a> have pulled back in recent weeks as traders digest Trump's election victory and ready for a new chapter in the economic narrative. The odds that the Fed will pause its rate-cutting cycle in December rising to 42%, up from 14% odds priced in a month ago, according to the <a target="_blank" class="" href="https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html">CME FedWatch tool</a>.

4 signs of re-inflation investors should watch out for, Charles Schwab says

<ul class="summary-list"><li>Expect a re-acceleration of inflation for the rest of 2024 into 2025, says Michael Landsberg.</li><li>High shipping rates and daily living expenses indicate that inflation could be worse than expected.</li></ul>A few months ago, it seemed like the war on <a target="_blank" href="https://www.businessinsider.com/higher-long-term-inflation-outlook-investing-strategy-attractive-bonds-stocks-2024-10">inflation</a> had been won.Wall Street strategists were expecting inflation to continue cooling down into 2025, clearing the way for a series of consistent rate cuts as the Federal Reserve insisted price increases were no longer a threat. In September, the Consumer Price Index (CPI) showed that prices rose 2.4% from last year — closing in on the Federal Reserve's target of 2%.Michael Landsberg, chief investment officer at Landsberg Bennett Private Wealth Management, wasn't so sure. He saw signs in the market pointing to a re-acceleration of inflation in the last few months of 2024 and into 2025.Now, it seems like Landsberg may be right. After a Trump victory, concerns about inflation are creeping up again as proposed policies such as <a target="_blank" href="https://www.businessinsider.com/trump-tariffs-hit-company-stock-profits-hardest-china-investing-manufacturing-2024-11">tariffs</a> could push prices up. And as the October CPI report showed, inflation is back on the rise, with prices increasing 2.6% year-over-year. In an interview with Business Insider, Landsberg shared the economic indicators he's watching to monitor inflation and the best way to prepare your portfolio in case of another flare up.<h2 id="7dc40d47-f3ee-4de6-bd68-d838e6c9299f">'Higher for longer'</h2>Inflation could rise to 3% as early as January and hit a mid-3% level in 2025, making it difficult for the Federal Reserve to continue its rate-cutting cycle, in Landsburg's view. He's expecting the Fed to pause rate cuts in December.Landsberg believes the Bureau of Labor Statistics' metrics aren't providing the full inflation picture. He's keeping his eye out on other economic indicators that provide a more on-the-ground look at inflation levels.First, rising Chinese shipping rates are a telling sign of inflation. China is one of the US' biggest trading partners, so an increase in transportation costs between the two countries will likely trickle down and reflect in consumer prices.Geopolitical conflicts in the Red Sea are contributing to the price increases, as shipping companies are forced to detour and choose longer and more expensive routes, according to Landsberg.With <a target="_blank" href="https://www.businessinsider.com/inflation-fed-rate-cuts-red-sea-attacks-panama-canal-shipping-2024-1">12% of global trade</a> passing through the Suez Canal, the Red Sea region is a critical trade route for consumer basics such as oil, cars, raw materials, and electronic components. As a result, these blockades are putting pressure on global supply chains and shipping costs.<div type="image" title="Shanghai Containerized Freight Index" height="663" width="1185" msid="115308890" hostid="261" sizebytes="33696"></div>The Shanghai Containerized Freight Index, which tracks the current spot freight rates for containerized cargo departing from Shanghai, China, has remained elevated in 2024 after spiking earlier this year due to the continued blockade of the Red Sea by Houthi rebels."Shipping costs don't affect margins of companies as much as they're going to affect people's wallets, and that's not getting looked at," Landsberg said.Landsberg also points to the high prices of commodities and everyday necessities. Food prices and rents are still rising. In some East Coast metro areas, rents have risen over double digits since last year, according to <a target="_blank" class="" href="https://www.redfin.com/news/rental-tracker-october-2024/">Redfin</a>.Insurance prices are another strong indicator of inflation, whether it be for cars or <a target="_blank" href="https://www.businessinsider.com/states-most-at-risk-climate-change-rising-home-insurance-premiums-2024-10">homes</a>."Inflation in insurance, which everyone has to have all the time, is up double digits year-over-year," Landsberg said. "That affects people's wallets certainly more than just a printed CPI number."That's not to mention the potential of wage inflation. According to October's employment report, hourly wage growth was up 4% from this time last year. If Trump clamps down on immigration, then that number could go even higher as the supply of workers falls, pushing up the cost of labor.<h2 id="102f3015-2817-4d7e-8b5c-6ea2e030d247">Rebalance your portfolio</h2>Diversification is key in an inflationary environment by spreading out risk between sectors and asset classes, but you might be less diversified that you think, according to Landsberg.One mistake that Landsberg sees investors making is doubling down too much on a specific investment theme. Investors bullish on AI may have devised creative ways to play the AI trade outside of the technology sector, such as buying data center real estate investment trusts and utility stocks. This can give them a false sense of security in their portfolio, as it seems like they're exposed to multiple different sectors.However, if all of your investments across sectors are based on the AI theme, you won't experience much derisking.Landsberg points to the market selloff in August this year, where utilities and real estate indices fared better than technology, but individual real estate and utilities stocks with significant exposure to data centers didn't perform so well."I tell people now that we need to be diversified on themes, not just on sectors," Landsberg said. Some other secular growth themes that Landsberg believes will drive stocks include an aging population, cybersecurity, and alternative energy.In addition to making sure you're sufficiently diversified, there are some other steps that you can take to protect your portfolio from inflation. Landsberg identified a few inflation-benefitting trades such as energy, financials, and <a target="_blank" href="https://www.businessinsider.com/how-to-invest-in-gold-price-record-highs-safe-haven-2024-10">gold</a>.Some funds that provide exposure to these sectors include the Energy Select Sector SPDR Fund (<a target="_blank" href="https://markets.businessinsider.com/etfs/the-energy-select-sector-spdr-fund-us81369y5069?miRedirects=1">XLE</a>), the iShares US Financials ETF (<a target="_blank" href="https://markets.businessinsider.com/etfs/ishares-us-financials-etf-us4642877884?miRedirects=1">IYF</a>), and the Goldman Sachs Physical Gold ETF (<a target="_blank" href="https://markets.businessinsider.com/etfs/goldman-sachs-physical-gold-etf-us38150k1034?miRedirects=1">AAAU</a>)As the end of the year draws near, Landsberg recommends taking a look at your portfolio and rebalancing some positions. If you're overexposed to technology and AI, now is a good time to put money in more inflation-resistant areas.Ultimately, make sure you're investing in high-quality companies with a robust financial profile, he said."You need to have a portion of your portfolio that will do well if inflation starts to move back higher," Landsberg said. "You want companies with pricing power, companies with earnings growth."

Here's how to rebalance your portfolio as these economic indicators flash 'higher for longer' inflation and rates

<ul class="summary-list"><li>Homebuilding execs say President-elect Donald Trump's deportation plans could worsen a worker shortage.</li><li>The industry heavily relies on immigrant labor and companies are wary of their workforce shrinking.</li></ul>Homebuilding-industry leaders and economists say President-elect Donald Trump's <a target="_blank" class="" href="https://www.businessinsider.com/trump-mass-deportation-thomas-homan-illegal-immigration-border-czar-ice-2024-11">plans to implement</a> the "largest deportation effort in American history" could kickstart a chain reaction that ultimately sends home prices higher.The issue is the construction labor force, whose <a target="_blank" class="" href="https://www.businessinsider.com/housing-crisis-national-shortage-construction-workers-job-demand-2024-5">500,000-worker shortage</a> is already making conditions more challenging. Even fewer workers would mean fewer completed homes. That inventory shortage is then seen driving higher prices.Since immigrants make up a large part of that group, housing economists and homebuilders worry that deportations and crackdowns could make the ongoing shortage worse, ultimately leading to more price increases.Foreign-born workers make up <a target="_blank" class="" href="https://eyeonhousing.org/2023/12/immigrant-share-in-construction-highest-on-record/">about a quarter</a> of the construction workforce. An <a target="_blank" class="" href="https://www.constructiondive.com/news/construction-workers-undocumented-presidential-election/729556/#:~:text=Immigrants%20entering%20the%20country%20illegally,all%20workers%20in%20construction%20jobs.">estimated 15 to 23%</a> of that overall workforce are undocumented immigrants. Foreign-born workers are particularly <a target="_blank" class="" href="https://eyeonhousing.org/2024/03/states-and-construction-trades-most-reliant-on-immigrant-workers-2022/">over-represented in the homebuilding trades</a>, including plastering, constructing drywall, and painting.Eric Finnigan, vice president of demographics research at John Burns, told Business Insider that if mass deportations happen, a lot of homebuilding, remodeling, and repairing "comes to a standstill and or prices go up by a lot."Even before concrete action is taken, the mere prospect of a crackdown could scare away workers and hurt the construction industry, economists and homebuilders say."The threat of it will be felt immediately and very viscerally among people who are working in the construction sector," Ben Metcalf, a housing policy expert at the University of California, Berkeley, told Business Insider."Just even the talk of mass deportations could send a chill through the entire immigrant employment sector," added Jim Tobin, CEO of the National Association of Home Builders.Trump and Vice President-elect JD Vance have repeatedly pushed back on these notions. From the perspective of housing prices, they have said that deporting immigrants would <a target="_blank" class="" href="https://www.businessinsider.com/jd-vance-said-migrants-to-blame-for-expensive-homes-wrong-2024-8">bring down housing costs</a> by reducing demand for homes.In a <a target="_blank" class="" href="https://singjupost.com/full-transcript-trump-speaks-at-the-economic-club-of-new-york/?singlepage=1">September address</a>, Trump said that Americans shouldn't "ignore the impact" millions of illegal aliens have had on driving up housing costs.Vance also recently refuted the idea that deportations and tougher immigration would deplete the construction workforce, arguing that there are ample displaced American workers ready to take those jobs."One of the really deranged things that I think illegal immigration does to our society is it gets us in a mind-set of saying we can only build houses with illegal immigrants, when we have seven million — just men, not even women, just men — who have completely dropped out of the labor force," he said in <a target="_blank" class="" href="https://www.nytimes.com/2024/10/12/magazine/jd-vance-interview.html">the interview</a>.<h2 id="629659ac-52c6-46c2-a06e-cb4aa7e1e5d5">An uncertain future for immigration</h2>Deportations are <a target="_blank" class="" href="https://www.nytimes.com/2024/07/17/us/trump-immigration-republicans-explained.html">logistically difficult</a> and <a target="_blank" class="" href="https://www.cnn.com/2024/10/19/politics/trump-mass-deportation-cost-cec/index.html">costly</a>, and it's unclear what the full scope of crackdowns will be. During his first term, Trump oversaw an initial uptick in removals, but his administration <a target="_blank" class="" href="https://www.cnn.com/2024/11/11/politics/deportations-trump-presidency-what-matters/index.html">deported significantly fewer people</a> — about 1.5 million — than former President Barack Obama did. The Obama administration deported 2.9 million people in its first term and 1.9 million in its second, while President Joe Biden <a target="_blank" class="" href="https://www.migrationpolicy.org/article/biden-deportation-record">is on track to remove</a> about the same number of people Trump did.Trump also <a target="_blank" class="" href="https://www.nytimes.com/2024/11/04/us/arrestees-trump-workplace-immigration-raid-mississippi.html">stepped up workplace raids</a> by Immigration and Customs Enforcement during his first term, and his incoming "border czar" Tom Homan <a target="_blank" class="" href="https://thehill.com/latino/4984064-trump-administration-workplace-raids/">recently promised</a> to ramp up raids again. "If you are in this country illegally in six months, pack your bags, because you're going home," Vance <a target="_blank" class="" href="https://www.washingtonexaminer.com/news/3145645/jd-vance-cracks-down-on-border-security-during-arizona-campaign-visit/">said in September</a>.Beyond mass removals, many employers in the construction industry are also concerned about more restrictive legal immigration policies. Many immigrants working in the industry are protected under certain special legal programs, like <a target="_blank" class="" href="https://www.usa.gov/daca">Deferred Action for Childhood Arrivals</a> and <a target="_blank" class="" href="https://www.uscis.gov/humanitarian/temporary-protected-status">Temporary Protected Status</a>, which were bolstered under Biden but may be <a target="_blank" class="" href="https://www.nytimes.com/2020/06/19/us/politics/trump-daca.html">ended by Trump</a>."Those programs are particularly susceptible to being terminated very quickly, which would leave construction companies in the lurch," Chad Blocker, a Los Angeles-based immigration attorney, told Business Insider.<h2 id="a15788ba-6b2f-4484-903a-5d59db1a90b9">A shortage of workers</h2>Some <a target="_blank" class="" href="https://www.businessinsider.com/jd-vance-said-migrants-to-blame-for-expensive-homes-wrong-2024-8">economists</a> <a target="_blank" class="" href="https://www.nytimes.com/2024/10/11/business/economy/trump-housing-crisis-deportations.html">disagree</a> with the Trump campaign's argument that deporting immigrants will alleviate housing affordability issues by lowering demand. They argue that the surge in home costs is largely a result of the nationwide housing shortage, and immigrants are a key part of building housing.Homebuilders pushed back on Vance's comments about a readily available American labor force sitting on the sidelines, waiting for construction job openings.During the pandemic, many older, experienced workers retired, and the pipeline of younger US-born workers <a target="_blank" class="" href="https://www.axios.com/2023/03/18/technical-worker-shortage-trade-education-construction">isn't sufficient</a>, homebuilders say. They note that with the rise of remote work and the tech sector, the building trades aren't particularly attractive to younger people."You don't have a whole lot of people that want to go up on a roof when it's 120 degrees out there," Dennis Webb, a homebuilder in Phoenix, told Business Insider. "They want to work in an air-conditioned office, and they want to be behind a computer, and they don't really want to do manual labor."Are you a home builder or immigrant construction worker concerned about shifting immigration policy or enforcement? Share your story with this reporter at <a target="_blank" href="mailto:erelman@businessinsider.com">erelman@businessinsider.com</a>.

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