Global stock markets saw mixed movements today as investors reacted to the latest U.S. inflation data, which came in higher than expected. The report has raised concerns that the Federal Reserve may keep interest rates elevated for longer, leading to volatility in equities, bonds, and commodities.

Key Highlights of the Inflation Report

The latest Consumer Price Index (CPI) data showed that inflation rose by 3.4% year-over-year, slightly above analysts’ expectations of 3.2%. Core inflation, which excludes food and energy prices, also remained sticky at 3.6%, reinforcing fears that inflation is proving harder to tame than anticipated.

Federal Reserve officials have indicated that they will closely monitor the data before making any rate adjustments. Many economists now believe that the much-anticipated interest rate cuts may be delayed until the second half of 2025.

Stock Market Reactions

• U.S. Markets: The S&P 500 and Nasdaq opened lower as investors worried about prolonged high-interest rates. Tech stocks, which are particularly sensitive to rate changes, saw declines, with Tesla, Apple, and Nvidia all in the red.

• European Markets: Major European indices such as the FTSE 100, DAX, and CAC 40 showed slight gains as investors balanced inflation worries with optimism over corporate earnings.

• Asian Markets: Nikkei 225 in Japan and Hang Seng Index in Hong Kong were mixed, with some tech and export-driven stocks facing pressure. China’s Shanghai Composite also dipped amid concerns about U.S. policy impacting global trade.

Impact on Commodities and Currencies

• Oil Prices: Brent crude and WTI oil prices rose over 2%, partly due to inflation concerns and OPEC+ hinting at production cuts.

• Gold: The price of gold surged as investors sought safe-haven assets, given the uncertainty surrounding rate hikes.

• Dollar Strength: The U.S. dollar strengthened against major currencies like the euro and yen, as higher inflation reduces the likelihood of imminent Fed rate cuts.