Hot October inflation report sends stocks lower and pushes 10-year Treasury yield back to 5%
Traders now see a December Fed rate hike as nearly certain, with a small chance of a half-point increase.
Stocks fell Tuesday after October consumer price data came in hotter than expected. The S&P 500 traded down 0.7%, the Dow fell 345 points, or 0.7%, and the Nasdaq Composite dropped 0.8%. The consumer price index rose 0.4% in October, above the 0.3% economists had expected. Core CPI, which excludes food and energy, rose 0.3%, compared with an expected 0.2%. The government did not release an annual figure because of the 2025 government shutdown. Fed Governor Christopher Waller said in London that he expects a December rate hike and opened the door to a half-point increase if inflation runs higher than expected. Dallas Fed President Lorie Logan said she expects two more rate hikes will be needed.
Key points
- October CPI rose 0.4% monthly, above the expected 0.3%
- 10-year Treasury yield climbed more than 14 basis points to 5.004%
- Traders see a December Fed rate hike as nearly certain
Read the original reporting
- CNBCS&P 500 falls after hot CPI ignites inflation concerns: Live updatescnbc.com
- MarketWatchWhy stocks are falling and the 10-year Treasury yield is back near 5% after Tuesday’s inflation reportmarketwatch.com
- Fox BusinessConsumer inflation rises faster than expected in October, CPI report showsfoxbusiness.com
Summarized with AI from the sources above and reviewed before publishing.
