U.S. inflation data for April triggered significant volatility across global markets, with sticky core consumer prices leading to surging Treasury yields, weakened rate-cut expectations, and a broad selloff in equities and risk assets. As traders reassess monetary policy outlooks, markets from the U.S. to emerging economies are reacting swiftly.
🌍 Market Summary
Markets sold off after April’s U.S. inflation data confirmed persistent core price pressures. The CPI release pushed Treasury yields higher, diminished Fed rate-cut expectations, and drove outflows from equities and emerging market assets. The dollar gained ground, while energy prices rose modestly due to geopolitical risks.
🇺🇸 United States
Key Events (May 14):
- CPI (YoY): 3.4% (in line)
- Core CPI (YoY): 3.6% (above est. 3.5%)
- Core CPI (MoM): 0.3% (as expected)
Market Performance:
- S&P 500: -0.48%
- Nasdaq 100: -0.78%
- Dow Jones: -0.21%
- 10Y Treasury Yield: ↑ 6bps to 4.48%
- USD Index (DXY): ↑ 0.5%
Highlights:
Sticky inflation for the third straight month led to a decline in Fed rate-cut bets. Traders now expect only one 25 bps cut in 2025. Fed’s Kashkari emphasized the need for more data before easing.
🇪🇺 Euro Area
Market Performance:
- STOXX 600: -0.60%
- German 10Y Bund Yield: ↑ 5bps to 2.52%
- EUR/USD: ↓ 0.4% to 1.080
Headlines:
German CPI confirmed at 2.2% YoY. ECB’s de Guindos signaled a likely June rate cut. Industrial production missed expectations.
🇬🇧 United Kingdom
Market Performance:
- FTSE 100: -0.26%
- GBP/USD: ↓ 0.6% to 1.252
- 10Y Gilt Yield: ↑ 5bps to 4.20%
Highlights:
Sticky U.S. inflation data influenced U.K. markets, leading traders to push back BoE cut expectations to September.
🇯🇵 Japan
Market Performance:
- Nikkei 225: +0.46%
- USD/JPY: ↑ 0.8% to 156.78
- 10Y JGB Yield: ↑ 3bps to 0.91%
News:
The yen weakened amid rising U.S. yields. Japan’s PPI rose 0.9% YoY. Authorities stayed silent on FX intervention.
🇨🇳 China
Market Performance:
- CSI 300: -0.44%
- Hang Seng: -0.83%
- CNH: ↓ 0.3% vs USD
Developments:
With no major data releases, traders look ahead to Friday’s industrial and retail data. Tech stocks dragged indices lower.
🌍 EMEA & Emerging Markets
🇹🇷 Turkey:
- USD/TRY: Flat at 32.28
- BIST 100: +0.2%
- FX-protected deposit share dropped to 18.8%, signaling confidence in TRY.
🇿🇦 South Africa:
- ZAR: ↓ 0.7%
- Inflation expectations rose ahead of SARB meeting.
🇧🇷 Brazil:
- IBOVESPA: -0.9%
- BRL: ↓ 0.6%
- Political tension and global yield shifts pressured assets.
🛢 Commodities
- WTI Crude: ↑ 1.3% to $79.20
- Brent: ↑ 1.1% to $83.40
- Gold: ↓ 0.7% to $2,340
- Silver: ↓ 1.2% to $28.12
News:
Oil rebounded amid rising Middle East tensions. Gold declined as real yields jumped following the CPI release.