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    Explained: How markets behave when inflation spikes

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    Explained: How markets behave when inflation spikes

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    Markets have been jolted a bit last couple of days as stronger-than-expected US inflation figures surprised the investors. US consumer prices rose sharply in April '21 and drove the rate of inflation to the highest level seen in nearly 13 years, 4.2 percent (versus expectations of 3.6 percent rise).

    Markets have been jolted a bit last couple of days as stronger-than-expected US inflation figures surprised the investors. US consumer prices rose sharply in April '21 and drove the rate of inflation to the highest level seen in nearly 13 years, 4.2 percent (versus expectations of 3.6 percent rise).
    The consumer price inflation rose 0.8 percent on a month-on-month basis and 4.2 percent on a year-on-year basis.
    This did not fare well for global markets that were worried about the rising inflation for a long time. And now the data gives way to fresh speculations on whether these figures will assume a monetary policy dimension.
    While Federal Reserve has time and again told investors that it aims to keep the monetary policy accommodative, investors continue to worry.
    Watch CNBC-TV18’s Prashant Nair explaining the history of the impact of inflation on markets.
    Check out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!
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