Consumer prices in the United States rose by 2.9 percent in December, while the consensus forecast of economists had expected inflation to accelerate to 2.9 percent from November’s 2.7 percent. The US inflation figures were the week’s most anticipated macroeconomic figure.
Core inflation adjusted for volatile food and energy was 3.2 percent in December, while it had been forecast to remain at November’s level of 3.3 percent.
On a monthly basis, prices rose in December by the expected 0.4 percent from November. Core inflation was 0.2 percent on a monthly basis.
The market interest rate for the US 10-year government bond went into a sharp decline after the inflation figures were announced, falling from around 4.76 percent to around 4.70 percent.
The dollar weakened against other major currencies. The euro now fetches $1.034, while before the publication of the statistics, the euro fetched around $1.030.
The stock index futures immediately started a clear rise. The rate of increase was just under half a percent.
Last Friday’s strong labor market report for December from the United States had made the market nervous around the end of last week, when interest rate cut expectations for the central bank, the Fed, had to be clearly lowered as the labor market was still riding strong, despite the central bank’s tight monetary policy and the economic difficulties in Europe and China.
Source: www.arvopaperi.fi
