U.S. inflation rises 0.4% in October and Wall Street falls on fears of a rate hike

U.S. inflation rose 0.4% in October, more than expected, and Wall Street fell on Tuesday on fears that the Federal Reserve will raise interest rates in December, according to official data released this morning.

The consumer price index (CPI) rose 0.4% for the month, down from 0.6% in September, while core inflation, which excludes food and energy, rose 0.3%. By midday, the Nasdaq was down 1.09%, the S&P 500 had lost 0.79% and the Dow Jones was down 0.70%.

Pressure mounted after Federal Reserve Governor Christopher Waller said in a speech in London that inflation remains too high and that tightening monetary policy is necessary “sooner, rather than later.” Waller added that if the numbers come in hotter than expected, a half-point hike in December should be considered.

The yield on the 10-year Treasury note rose to 5.02% and gold fell 2.82%, to $4,023.75 an ounce. Oil also fell on hopes that the conflict with Iran will end soon. The drop contrasts with Monday, when the S&P 500 had its best day since April, rising 2.35%.

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Source: Investopedia