Inflation In US: Dow futures up 800 points after US consumer inflation data
New Delhi. There is news of relief regarding inflation in America. According to a release issued on Thursday by the Bureau of Labor Statistics, consumer prices in October 2022 stood at 7.7 per cent, compared to 8.2 per cent in September. In the US, consumer goods prices rose 0.4 percent on a monthly basis. Stock futures saw a sharp jump on Thursday following the October readings of consumer prices. The reason for the increase in inflation is the increase in the prices of gas, food and other essential commodities.
Excluding food and energy prices, core inflation grew 6.3 per cent in 12 months, compared to 0.3 per cent since September. The figures of inflation that have come are less than the estimates of economists. Inflation has come down due to the fall in the prices of many things. Inflation has had an impact on the US economy. Consumers are cutting spending, the effect of which has been seen on the results of companies.
A 2.4% drop in the prices of used vehicles helped bring down the inflation figures. Apparel prices fell 0.7% and medical care services were down 0.6%. Federal Reserve Chairman Jerome Powell and his central bank allies will soon slow or halt aggressive interest rate hikes to try to contain inflation.
While investors looked to inflation data with no definitive results available from the US mid-term elections, futures linked to the Dow Jones Industrial Average jumped 844 points, or 2.6%. S&P 500 futures jumped 3%, while Nasdaq 100 futures rose more than 3.7%. Following the CPI report, the 10-year Treasury yield fell over 18 basis points to 3.946%, falling below the 4% level.
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Despite the slowdown in the inflation rate, it is still well above the Fed’s 2% target, and several areas of the report show that the cost of living remains high. Due to increase in inflation, workers took another pay cut in October. According to a separate BLS release, real average hourly earnings declined 0.1% for the month and declined 2.8% on an annualized basis.
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FIRST PUBLISHED : November 10, 2022, 21:08 IST