The US saw a surge in consumer prices in January. The surge happened sooner than it was anticipated, indicating a rigid inflation that bolstered expectations of higher interest rates.
The anticipated growth in the Consumer Price Index was 0.3 percent while it actually grew by 0.5 percent. The consumer price index is a varied way of measuring inflation than the way the Federal Reserve typically lays emphasis on.
The Commerce Department also reported that US retail sales declined 0.3% in January, an unexpected drop that analysts said made it more difficult to draw a clear picture of the US economy.
On Wednesday, the US Bureau of Labour Statistics mentioned that there had been surge in the prices of gasoline, clothing, medical care and food.
For the last one year, inflation stood at 2.1 percent.
Fiona Cincotta, market analyst at City Index opined: “The fact that… losses are being trimmed, suggests that the market could be slowly starting to get to grips with the new higher inflation environment reality.”
The report on the climb in the US wages prompted concerns revolving around the instability in the financial markets.
The Commerce Department made another statement saying that the US retail sales had a 0.3 percent unpredicted drop in January that had made it too difficult for analysts to draw the US economy.