Equities Rise as Mild Inflation Data Eases Fed Rate Hike Bets

Global equities rose on Wednesday as mild inflation data reduced the likelihood of a Federal Reserve interest rate hike. U.S. consumer prices increased 0.1% in July, meeting expectations and easing pressure on the Fed to raise rates.

The small increase in inflation was partly due to higher energy prices, but it was not enough to push the argument for a rate hike from the Fed next month. Money markets had shown a roughly 50% chance of a hike before the data release.

Robert Pavlik, senior portfolio manager at Dakota Wealth Management, said the data 'relieves some of the concerns that the Fed is being pushed toward a rate hike due to inflation.'

Oil prices edged higher as investors balanced lower demand forecasts against geopolitical tensions between the U.S. and Iran. The United States and Yemen's Iran-aligned Houthis reported separate ship attacks on Tuesday, but oil prices fell initially before rising again.

Brent futures settled up 7 cents at $88.98 a barrel, while U.S. crude rose 7 cents at $83.27 in a volatile session.