The data on inflation (CPI) in the United States published on Tuesday shows that it rose more strongly than expected in January. The US stock markets reacted with declines.

Inflation at 3% in January

A year-on-year inflation rate of 3.0% was measured for January. An increase of 0.1% compared to the previous month, although no change was expected. In the monthly comparison, a decline of 0.1 % was expected, but consumer prices actually rose from 0.4 % to 0.5 % in January.

The same picture emerges for the core rate of consumer prices (excluding energy and food). This rose by 0.1% year-on-year to 3.3%, whereby a decline of 0.1% was expected. In a month-on-month comparison, the core rate rose by 0.2 % to 0.4 %, exceeding the expected increase to 0.3%.
US Indices show recovery after losses

US indices show recovery after losses

Following the publication of the inflation data, the US indices initially reacted with price losses, some of which were substantial. The Don Jones fell by over 450 points at its peak and the S&P 500 by around 70 points. The indices have since recovered at least in part from the initial losses, but remain under pressure during the hearing of Fed Chairman Jerome Powell, as he appears unable to dispel doubts about the Fed easing its monetary policy in the near future.

US dollar reacts with gains

In contrast to the stock market, the US dollar is reacting positively to the rise in inflation. The US dollar has made significant gains against the Japanese yen, with the USD/JPY exchange rate currently rising by around 1.25%. The dollar-denominated gold price was able to recover some of its losses following the publication of the inflation data and is currently down by around 0.3%.

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