MPC Morning Call 19th December 2025 – Stocks Higher on bogus inflation data
Stocks headed higher overnight as CPI Inflation data was released, stoking rate cut bets for January. The numbers are highly questionable.
WATCH ON YOUTUBE MPC Morning Call 19 th December 2025 – Stocks Higher on bogus inflation data Stocks headed higher overnight as CPI Inflation data was released, stoking rate cut bets for January. The numbers are highly questionable. U.S. inflation rose less than expected in November, signalling potential cooling in price pressures and boosting hopes for interest rate cuts next year. The Consumer Price Index increased 2.7% year-on-year, below the projected 3.1% and down from September’s 3.0%. Core inflation, excluding food and energy, climbed 2.6%, also below expectations. Analysts cautioned that data collection disruptions from the recent government shutdown may have distorted results, suggesting December’s figures will be key to confirming whether the drop marks a true disinflation trend or a temporary anomaly. The data has clearly been manipulated with seasonal adjustments to food and energy not collected Expectations for Federal Reserve rate cuts strengthened following the softer inflation data. Traders now see roughly an 80% chance of at least a 50-basis-point reduction by the end of 2026, compared to 75% before the report. The cooling inflation backdrop, combined with growing investor confidence in monetary easing, helped lift broader market sentiment and supported a rebound in major technology stocks after several sessions of weakness. Micron Technology led the gains after its earnings and upbeat guidance far surpassed Wall Street forecasts, driven by strong demand for AI-related memory chips. Shares of other big tech companies, including Alphabet, NVIDIA, Meta, and Microsoft, all rose more than 2%. In contrast, Instacart tumbled amid reports of a Federal Trade Commission probe into alleged AI-driven price discrimination. CarMax also slipped after announcing thinner margins and higher marketing spend, while MillerKnoll and Lululemon surged on strong earnings and news that activist investor Elliott took a significant stake in the latter. Government Bond Yields Commodities, Energy & FX ASX Overnight: SPI 8547 (+0.54%) The Day Ahead: we should end the week on a positive note
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