U.S. consumer prices rose more than expected in January as costs for clothing and food climbed higher, adding to investor concerns about rising inflation.
The Dow Jones Industrial Average tumbled around 1 percent in premarket trading after the Bureau of Labor Statistics released the consumer price data on Wednesday morning. Before the CPI release, stock futures had been pointing to gains at the opening bell.
Consumer prices rose 0.5 percent in January, compared with the expectation from economists for a 0.3 percent increase, according to Bloomberg News. Over the past year, consumer prices rose 2.1 percent, higher than a forecast for a 1.9 percent increase.
The specter of high inflation has spooked many investors, who worry it would force up interest rates, making it costlier for consumers and businesses to borrow and weighing down corporate profits and ultimately the economy. Historically, fear of high inflation has led the Federal Reserve to step up its short-term interest rate increases.
It’s a big reason investors have dumped stocks and bonds in the past two weeks.
The Associated Press contributed reporting.
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