US Consumer Prices Rise at Fastest Pace in Five Months

• US September Core CPI rose 0.3% month-over-month and 2.6% year-over-year, both exceeding economists' estimates.
• Broad-based inflation was observed in categories such as gasoline (+9.1%), fuel oil (+15.3%), used cars (+0.7%), recreation, education, airline fees, and medical care.
• Treasury yields surged across the curve (2-year, 10-year, 30-year), while S&P, Nasdaq, and Russell 2000 futures declined.
• The stronger-than-expected core CPI print has led traders to add to bets on an October Federal Reserve interest rate hike.

The September US CPI report revealed headline inflation in line with estimates but core inflation hotter than expected, indicating persistent price pressures across various categories. This data immediately triggered a significant rise in Treasury yields and a fall in equity futures, leading to increased market bets on a potential October Fed interest rate hike.