Monetary policy: Inflation in the USA jumps up in September – quick reaction in the bond market
Price pressure in the world's largest economy continues to increase shortly before the midterm elections.
Quick Look
- US inflation rose to 3.7 percent in September compared to the previous year.
- Experts expect a further increase of over four percent by the end of the year, which led to an immediate reaction in the bond markets.
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Why It Matters
The data comes from the US Department of Labor and concerns the Consumer Price Index (CPI).
Dusseldorf, New York. Shortly before the important midterm elections in the USA, price pressure increased again. Goods and services (CPI) in the world's largest economy rose by 3.7 percent in September compared to the same month last year. This is shown by data published by the Ministry of Labor on Wednesday. On a monthly basis, i.e. from August to September, inflation was 0.6 percent.
Economists had expected price pressure to increase again from 3.4 percent in August, but to a lesser extent. A trend that is likely to continue: According to experts, inflation will rise again above the four percent mark by the end of the year.
An initial reaction was immediately evident in the recently nervous bond markets. After publication, the benchmark yield on ten-year government bonds temporarily rose by 13 basis points to 5.34 percent. In the further course it is 5.30 percent. 30-year papers yield 5.61 percent.
Open Questions
- How is the Federal Reserve responding to inflation data?
