inflation
U.S. consumer prices exceeded economists’ expectations, rising 4.2% in April, surpassing the level they were 12 months ago.
The news could further raise concerns about possible inflation that are approaching.
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4.2% has attracted the attention of investors, economists and analysts as it could lead to a high demand and price surge brought through vaccine rollouts and other factors.
It is the highest level of inflation since 2008, well above the 2.6% figure in March.
“What we’re looking at is the supply and demand aspect factors, from financial stimulus to increased consumer spending, to supplying pandemic-related bottlenecks associated with rising costs. It’s a complete storm.”
It poses new challenges for Joe Biden and the federal government as it seeks to inject life into the US economy following the coronavirus pandemic.
US Stocks
The US market suffered in the aftermath, with Dow Jones down 0.6%. And while it may be relatively measured, its current girth amounts to a collapse of 200 points, bringing the Dow below 34,100 for the first time in nine days to below 34,100.
“The market is always on high with many reopening trades already priced, so it doesn’t matter that Outsized Inflation Read can bring us back a bit.” Of the electronic trade investment strategies told CNBC.
“The Fed made it clear that inflation will not increase. It doesn’t necessarily shake it up from a simple money policy, and jumps like this could be temporary. So, this Is it a trend? We haven’t seen it yet,” Lowengert said.
Technology stocks in particular have been under pressure in recent weeks and months.
Dollar
The dollar went in the opposite direction of the Dow, adding 0.4% against the pound and 0.5% against the euro.
“Greenback profits help explain why Europe didn’t lower the US market and strengthen their hands as the session progresses,” said Conor Campbell, financial analyst at Spreadex. Masu.
