The U.S. consumer price index rose at the fastest pace in five months in September, with the key measure of underlying inflation exceeding forecasts, putting continued pressure on household budgets ahead of the November midterm elections.
According to data released Wednesday by the U.S. Bureau of Labor Statistics, consumer prices increased 0.6% month-on-month in September, driven by soaring fuel costs. Excluding food and energy, the core CPI—the crucial gauge of underlying inflation—rose 0.3%. On a year-over-year basis, core inflation climbed 2.6%, while headline inflation rose 3.7%.
The CPI data triggered a sharp overnight sell-off in U.S. tech stocks, with the Nasdaq 100 index dropping more than 3%. The global equity selloff intensified across Asia, particularly hitting chip stocks. South Korea’s Kospi index—the barometer for AI-related investments—led declines in the Asia-Pacific region, falling 7.6%, as semiconductor makers Samsung Electronics and SK Hynix both dropped over 9%.
Megan Swiber, interest rate strategist at Bank of America, said investors are now “waiting for Powell’s speech tomorrow to confirm whether the Fed will continue hiking rates.” Commenting on the inflation data, she noted: “This is broadly strong inflation, which makes it harder for the Fed to ignore.”
Mary Daly, president of the Federal Reserve Bank of San Francisco, told Reuters in an interview on Wednesday that the Fed may need to raise short-term interest rates to combat inflation, but suggested no immediate action was necessary this month. “We likely need further adjustments, but we’re still considering the timing,” she said.
Senior officials including Fed Vice Chair Philip Jefferson, Governor Christopher Waller, and Williams had already signaled before Wednesday’s announcement that the Fed does not need to rush into another rate hike after deciding to raise rates for the first time since 2023 at its September meeting.
Gold: Prices dipped from around 4150 to 4073 last night but then strongly rebounded, forming a U-shaped recovery. Today’s focus is on whether this rally can break through the key resistance zone at 4150/60; if so, targets could extend to 4180 and 4200. If resistance holds, look for support near the demand zone around 4100.
(Gold 15-minute chart)
Nasdaq: Prices plunged over 3% overnight, with no clear signs of stabilization yet. However, there is potential support in the 29,500/29,600 range. We recommend waiting for a return in bullish momentum before seeking buying opportunities on pullbacks.
(Nasdaq 15-minute chart)
Crude Oil: Prices remain in an expanding consolidation pattern above 95. Key support today lies around 93/93.50; a further breakdown could trigger a move toward 92 and 91. We are watching for selling opportunities on pullbacks following a breach of critical support.
(Crude Oil 15-minute chart)
Key Economic Data and Events Today:
14:00 UK August Three-Month GDP Monthly Rate
17:00 Eurozone August Industrial Production Monthly Rate
20:30 U.S. September Retail Sales Monthly Rate; U.S. Initial Jobless Claims for Week Ending October 10 (in thousands); U.S. September PPI Yearly Rate
