### Analysis of the US Inflation Data and Market Response
The latest US inflation data for September came in slightly higher than expected, with core inflation reaching 3.3% on an annual basis, exceeding analysts’ consensus forecast by a tenth of a percent. Moreover, the month-on-month inflation rate accelerated to 0.3% between August and September, also surpassing expectations.
#### Market Reaction and Central Bank Statements
Initially, this news sparked some nervousness in the financial markets. However, an unexpectedly large increase in initial jobless claims and reassuring statements from various representatives of the US central bank helped calm the market.
### Shift in Interest Rates and Monetary Policy Outlook
The strong employment figures for September, coupled with the inflation data, have led to a noticeable shift in the bond market. The crucial US ten-year bond yield has continued to rise and is now trading around 4.08%, a significant increase from mid-September when it was hovering around 3.6%. Additionally, expectations of significant interest rate cuts have diminished not only in the US but also globally.
It is still anticipated that the US central bank will cut rates at its remaining two monetary policy meetings this year, but the likelihood of further aggressive rate cuts has decreased. Forecasts for the number of rate cuts expected by 2025 have been significantly revised downward, with the US policy rate projected to be around 3.5% by the end of 2025.
### Global Monetary Policy Outlook
Expectations for the pace of rate cuts by other central banks have also tempered in recent weeks. The certainty of a double rate cut by the Swedish central bank at its upcoming meetings is no longer as strong, although it remains a probable scenario. The Norwegian central bank is not expected to cut rates this year, while the Bank of England is expected to proceed cautiously.
### Future Indications from the European Central Bank (ECB)
An important indicator of future central bank actions will come from the ECB’s monetary policy announcement next week. While the ECB is known for its caution, continued weak economic signals and inflation approaching the target (with CPI already below 2%) could pave the way for a larger rate cut than the usual 25 basis points. While this is not the main scenario, significant surprises have occurred in the past.
This comprehensive analysis of the recent inflation data, market trends, and central bank responses provides valuable insights for investors, economists, and individuals interested in understanding the current economic landscape and its potential implications for their financial future.