US CPI data led the ASX 200 to a 1.5% gain this morning

Nick Sundich Nick Sundich, November 15, 2023

The latest US CPI data led to a strong session in New York, and the ASX is following suit with a gain of over 1.5% in both the ASX 200 and All Ords. Was it really as good news as you would imagine from the gain that has occurred?

 

ASX 200, log scale (Source: TradingView)

 

US CPI data looks good

Simply put, yes. Inflation in America was 3.2% higher in the 12 months ended in October, down from 3.7% in both September and August.

Comerica Bank chief economist Bill Adams declared that the inflation fever had broken, not just because inflation was lower but because prices were essentially flat.

This will mean that there will likely be no further rate hikes, and rate cuts may occur sooner.

 

What does this mean for Australia?

In our view, not much, given inflation is proving much harder to tame. It wouldn’t surprise us to see more rate hikes from here.

Nonetheless, the US CPI data could be good news for some ASX stocks that are heavily focused on the US, because it could mean that better times are ahead. At the same time, it could be bad news for stocks that have gained from high inflation, particularly discount retailers and utility providers.

 

What are the Best ASX Stocks to invest in right now?

Check our ASX buy/sell tips

 

Recent Posts

johns lyng group

Johns Lyng Group (ASX:JLG): One of a few ways to profit from climate change

Johns Lyng Group (ASX:JLG) is a restoration services company, repairing properties after damage by insured events, including weather and other…

hydrogen in australia

Hydrogen in Australia: Can we expect massive adoption in the next 10 years?

When will we see hydrogen in Australia? Not as a fad, not as an idea, but as a widespread energy…

Why is Gina Rinehart buying into Lynas

Why is Gina Rinehart buying into Lynas? She’s accumulated a stake worth over $300m

The big question on many investors’ minds this week is why is Gina Rinehart buying into Lynas? A substantial notice…