Finance

August consumer price index data revealed a headline annual inflation rate of 3.4%, matching forecasts. However, the core CPI component, which strips out volatile food and energy costs, came in slightly hotter than expected at 0.3% for the month, prompting market participants to price in an 87% probability of an interest rate hike at the upcoming central bank meeting.

Brent crude futures experienced sharp fluctuations, hitting a four-month high near $110 a barrel before retreating roughly 3% to settle around $104 per barrel. Energy markets remain highly sensitive to prolonged geopolitical conflict in the Middle East and physical infrastructure disruptions, keeping weekly gains for crude benchmarks near 9%.

U.S. government bond yields remained elevated as market expectations shifted toward higher interest rates for a longer duration. The 10-year Treasury note yield stabilized just under the 5% threshold, ending the week near 4.96%, while the short-term 2-year note pushed past 4.6%.