US inflation data enhances uncertainty in financial markets - Chris Harmse

US INFLATION data is better than expected. Most global financial markets moved sideways and uncertain last week in anticipation of the US inflation rate data that was released on Friday.

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Expectations were that the annual increase in the US CPI would be 3.1% in September, higher than the 2.9% annual inflation rate increase in August.

Analysts and economists anticipate that if the US inflation rate reaches 3.0%, the US Federal Reserve is likely to decrease its Bank rate at its next meeting in November.

The US announced on Friday that its annual inflation rate in September has risen by 3.0%, the highest level since January. Energy prices rose 2.8% in the year, the most since May 2024. Annual core inflation slowed to 3% from 3.1%, with markets expecting it to stay at 3.1%.

Given the lack of US non-farm job data due to the continuing of the US government shutdown, uncertainty prevails on the possibility of a cut in interest rates by the Fed at its meeting on Wednesday.

The US dollar remains under pressure but equity prices on Wall Street welcomed the better inflation rate data and ended the week stronger.

The Dow Jones Industrial index ended the week 2.2% higher, The S&P500 advanced by 1.9% and the Nasdaq gained 2.3%.

South Africa's inflation rate, share prices and the Rand