14 October 2026
If you are covering the latest US inflation data, please find below a comment from Richard Carter, head of fixed interest research at Quilter Cheviot:
"Inflation in the US has come in higher than expected, in a blow to Donald Trump ahead of November’s midterms. The President has been desperate to show he is getting inflation under control and providing the environment for rate cuts, even going so far as allowing Russian diesel back into the market, but those moves are proving too little too late as the war in the Middle East continues to have a grip on the global economy.
"CPI came in at 3.7%, slightly above expectations, and similarly core inflation was above predictions, suggesting that prices are feeding into the wider economy. Fuel and energy do remain the primary driver of inflation and certainly explains the actions of the US administration of late.
"This data is going to heap a whole lot of pressure on the Federal Reserve. Any chance of cuts to help with a stumbling labour market have essentially been vanquished with such elevated levels of inflation. The conflict in the Middle East will not be resolved any time soon, and as such, the current levels of inflation will likely remain well into 2027.
"Bond yields have been under scrutiny in recent weeks as those inflation concerns harden, and this will do little to appease the market. It is not inconceivable that ten-year treasury yields continue to march higher. Indeed, today’s data means another rate hike this year from the Fed cannot be ruled out as it may need to get more aggressive in its policy decisions in order to quell other inflationary trends."
