United States (US) consumer prices increased slightly less than expected in September, prompting traders to bring forward their rate cut forecasts. They now anticipate three quarter-point reductions by March instead of April.

“It’s quite positive (the data) and it certainly clears the way for the Fed to cut rates next week and leads to a higher expectation of at least two more cuts (by March),” said Eric Gerster, chief investment officer at AlphaCore Wealth Advisory.

The Fed is set to cut rates by 25 basis points in its policy meeting scheduled on October 29. The economic picture, however, remains murky, with business activity showing a tepid rebound in October. The White House warned that next month’s inflation data may not be released due to the government shutdown, now into its 24th day.

–SABC–