FTSE 100 Live: US inflation in focus, Covid update boosts Asia markets

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nflation figures in the United States are today expected to show the annual rate has fallen back from its four-decade high of 8.5%.

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Economists are looking for CPI to ease to 8.1%, although this is unlikely to stop interest rates rising by another 0.5% next month.

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Markets have stabilized after heavy selling over the past week, with today’s mood further helped by a rally for Asia shares after Shanghai reported a drop in new Covid infections.

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Asia markets lifted by Covid case update, FTSE 100 seen higher

The focus of global markets is on today’s US inflation figure and hopes that the April rate has fallen back from the previous month’s 8.5%.

An annual figure of 8.1% is forecast, but even then economists are unlikely to revise expectations for another half point hike in interest rates next month.

China’s inflation figure for April was released earlier, with the annual inflation rate up to a bigger-than-expected 2.1% from 1.5% in March. The country’s highest figure since November was blamed on disruptions caused by Covid measures.

The zero-Covid policy has added to fears of a global economic slowdown, although there are some hopes that the pandemic may be in retreat in China after Shanghai reported a 51% drop in new infections and Beijing also announced fewer cases.

The Shanghai Composite is trading 1.75% higher amid hopes for an end to the economic disruption caused by recent lockdown measures.

European markets are also set for a stronger session after Wall Street posted a resilient performance following three consecutive days of heavy losses. Apple and Microsoft shares were 2% higher as the Nasdaq recovered by 1%, but the Dow Jones Industrial Average finished slightly lower.

CMC Markets expects the FTSE 100 index to open 33 points higher at 7276.

The Brent crude price is also recovering lost ground, rising 3% to $105 a barrel after falling heavily over the previous two sessions due to demand fears. Bitcoin, meanwhile, is up 1.5% at $31,441.

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Credit: www.standard.co.uk /

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