CPI has triggered a wave of selling, and the AI market is now facing the challenge of bearing financing costs.

After the inflation data was released, market attention shifted towards who could survive in a environment of higher interest rates. Wall Street experienced a day marked by the exposure of multiple risks. Expectations for interest rate hikes increased due to high inflation levels. The energy market continued to face pressure, and the decline in AI-related bonds began to influence the decisions of stock investors.<br /> <br /> According to data from the U.S. Bureau of Labor Statistics, September’s CPI increased by 0.6% month-on-month, and by 3.7% year-on-year. Excluding food and energy costs, core CPI rose by 0.3% month-on-month, and by 2.6% year-on-year. Among the overall monthly increases, gasoline accounted for more than half of the rise. However, housing, healthcare, and airline ticket prices also increased simultaneously, indicating that price pressures weren’t solely due to energy issues.<br /> <br /> Under typical inflationary scenarios, the initial reaction of the market would be: U.S. Treasury bond yields rise, expectations for interest rate hikes increase, the dollar strengthens, while gold, cryptocurrency assets, and interest-rate sensitive stocks decline.<br /> <br /> However, as stocks continued to fall, U.S. Treasury bonds saw renewed buying activity.