Global Stock Indexes Dip as U.S. Inflation Beats Expectations; Cryptocurrency Markets Garner Attention

Global stock indexes experienced a downturn on Thursday, with the S&P 500 retracting from its record closing high. Meanwhile, the dollar reached a one-month high against the yen, driven by data revealing that U.S. consumer price inflation exceeded economists’ expectations in December.

Investors grappled with the impact of the latest inflation figures, as the headline Consumer Price Index (CPI) rose by 0.3% last month, resulting in an annual gain of 3.4%. This surpassed the anticipated figures of 0.2% and 3.2%, respectively. The data raised questions about the likelihood of an immediate rate cut by the Federal Reserve, causing the odds of a March rate reduction to slightly decrease from 67% to 65%, according to the CME Group’s FedWatch Tool.

In addition to the inflation concerns, investor attention also shifted towards the cryptocurrency markets. Late on Wednesday, U.S. regulators approved the first U.S.-listed exchange-traded funds (ETFs) to track bitcoin, marking a significant development in the world of cryptocurrencies. The approval led to the commencement of trading for several ETFs linked to the spot price of bitcoin in the U.S. on Thursday.

As financial markets digest these developments, the interplay between economic indicators, inflationary pressures, and cryptocurrency advancements will likely influence investor sentiments in the days to come.