NEW YORK, Feb 10 — Wall Street stocks fell early today as another reading of unexpectedly strong inflation exacerbated worries over tightening monetary policy.
The yield on the 10-year US Treasury note, a proxy for interest rates, hit two per cent for the first time since July 2019.
The report from the Labour Department said its consumer price index climbed 7.5 per cent over the 12 months to January, its largest increase since February 1982, while it rose by 0.6 per cent compared to December, more than analysts expected.
About 15 minutes into trading, the Dow Jones Industrial Average was down 0.4 per cent at 35,614.42.
The broad-based S&P 500 dropped 0.8 per cent to 4,551.05, while the tech-rich Nasdaq Composite Index shed 1.3 per cent to 14,305.95.
Stocks had risen solidly the last two sessions.
The data adds to expectations that the Fed will lift interest rates next month as part of a tightening cycle that could accelerate if pricing pressures do not abate.
“The inflation picture is getting worse, making it clear yet again that the Fed is behind the curve in fighting inflation,” said Briefing.com analyst Patrick O’Hare.
“Don’t be surprised, of course, if you soon hear the line that this bad inflation report just means we are at, or near, peak inflation; therefore, it can be construed as good news for the market... blah, blah, blah.” — AFP
