Spreadex Market Update
US inflation turns negative for first time since February
That inflation drop marks the 4th consecutive month of falling prices, and sees US inflation turn negative (at -0.1% against the 0.0% expected) for the first time since February. Yet, perhaps due to the proximity of the Fed’s potentially decisive statement on Thursday evening, investors didn’t see this CPI downturn as the rate-hike delaying guarantee they once might have, leaving the Dow Jones effectively flat on the day at 16600(ish).
The FTSE had its own interest rate news to deal with this afternoon; Mark Carney spoke before the Treasury Select committee to discuss yesterday’s inflation report, providing the vague, if diplomatic, comment that there are ‘a wide distribution of possible outcomes’ for the Bank of England in regards to if and when it raises rates. Not that this stopped the pound from surging against the dollar, with the combination a particularly strong UK jobs report and a dovish US inflation figure causing cable to jump over a percent at its session highs. The FTSE, meanwhile, continued to be buoyed by the best wage growth figures since 2009 (as well as the SABMiller/AB InBev reports), increasing by around 60 points to cross 6200.
Over in the Eurozone things were a bit more mixed; the CAC continued to grow as the day went on, approaching a 60 point gain on its opening price after the bell rang on Wall Street. The DAX, however, sporadically dipped its toes in the red, with investors perhaps especially cautious around the German index ahead of tomorrow’s FOMC decision, given how volatile the bourse can be.
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