US CPI Inflation Hitting 3.8% Underscores the Fragility of the Disinflation Narrative - Tekedia

U.S. CPI rose 3.8% year over year, above expectations and the highest since May 2023.

Sticky services and housing costs kept core inflation elevated, weakening hopes for a quick disinflation trend.

The hotter reading lifted bond yields and reduced market expectations for near-term Fed rate cuts.

Markets are now pricing a longer stretch of restrictive Federal Reserve policy.