It’s a big day for inflation watchers as the US releases its latest cost of living figures. The consensus forecast is for the annual CPI inflation rate to fall from 8.2% in September to 8% in October.
However, the month-on-month rate is expected to jump from 0.4% to 0.6%, suggesting that inflation remains sticky and that pressures on consumers and businesses are still severe.
Russ Mould, investment director at AJ Bell, said: “Pricing power has been a big theme on companies reporting over the past few months, with many businesses talking about how they’ve passed on extra costs to the customer. While that helps to preserve their profit margins, it does suggest a continuation of the strong inflation environment.
“European stock markets were relatively calm ahead of the inflation figures, with the FTSE 100 flat at 7,295 and the key indices in Germany, Spain and France down approximately 0.3%.
“Asia was more volatile with a 1.7% drop in the Hang Seng index in Hong Kong thanks to weakness in tech stocks.
“Utility stocks were in demand in the UK after Centrica’s results, while pharma, healthcare and banks were also in favour.”