August CPI: The Fed May Hike And Stocks Don't Care

Agar Capital 5.63K Followers Follow Summary August core CPI rose 0.3% month-over-month, exceeding expectations and signaling persistent price pressures, especially in services. Market reactions were volatile but ultimately muted, as investors view a potential 25 bps Fed hike as an adjustment, not the start of a new tightening cycle. Key inflation drivers included a sharp rise in communications and shelter away-from-home, with gasoline impacting headline but not core inflation. I do not see this as a reason to reduce equity exposure, but caution that inflation is not yet resolved and future Fed actions remain data-dependent. Yau Ming Low/iStock via Getty Images August headline CPI increased by 0.4% month over month, while core inflation rose 0.3%, above expectations of 0.2%, and annual core inflation dropped to 2.4%. This has caused investors to prepare for the possibility of the Federal Reserve raising rates This article was written by Agar Capital 5.63K Followers Follow I’m a Portfolio manager (flexible equity funds and private clients), fundamental equity research, macro and geopolitical strategy.Over 10 years across global markets, managing multi-asset strategies and equity portfolios at a European asset manager.I combine top-down macro, bottom-up stock selection and real-time positioning (Bloomberg, models, data).I focus on earnings, tech disruption, policy shifts and capital flows — to identify mispriced opportunities before the market.On Seeking Alpha I share high-conviction ideas, contrarian views and deep breakdowns of both growth and value names.For more insights: follow me on X @AgarCapital Analyst’s Disclosure: I/we have a beneficial long position in the shares of SPX, NDX either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.