US Stocks Rise on In-Line July CPI Data, Interest Rate Bets Unchanged

The US stock market rose on August 12 as July's inflation data came in line with expectations, easing concerns about a near-term acceleration in consumer prices. The Dow Jones Industrial Average remained largely flat, while the S&P 500 and Nasdaq Composite advanced.

July's Consumer Price Index (CPI) rose 0.1% month-on-month, while the annual inflation rate stood at 3.4%. Core CPI, which excludes food and energy prices, increased 0.2% from the previous month and 2.5% from a year earlier.

The data reinforced expectations that the Federal Reserve could keep interest rates unchanged at its September meeting. Ellen Zentner, chief economic strategist at Morgan Stanley Wealth Management, said the in-line inflation reading keeps the 'no need to hike rates' narrative intact following last week's jobs report.