What’s happening: The Consumer Price Index rose 7.7% for the year ending in October, a much slower pace of increase than the 8% economists had expected and the lowest annual inflation reading since January. Investors may be in for another letdown as sustained price pressures in housing, wages and energy mean the central bank still has a long way to go in its battle against inflation.
That means the Federal Reserve could be less aggressive with its rate hikes.īut Wall Street’s memory is short: Less than two weeks ago Fed Chair Jerome Powell unambiguously said rates would remain higher for longer. Investors broke out their party hats as they interpreted the report to mean that peak inflation may finally be behind us. Stocks surged on Thursday in their best day since 2020 after a key inflation indicator came in softer than expected.
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