Week InReview: October 14, 2022

Inflation is spreading deeper into the US economy, slamming the door on hopes the Federal Reserve will dial back interest-rate hikes that threaten to tip the country into recession. Core inflation, excluding food and energy, jumped to a 40-year high of 6.6% in September from a year ago, triggering a slide in US bond markets as investors bet the Fed will be forced into two more 75 basis-point increases this year. Stocks plunged and then rallied, making for a dizzying day on Wall Street, while the yen hit a 30-year low before it too rebounded. A key measure of US mortgage rates soared to a 20-year high just shy of 7% — and some are warning they could go much higher. Asian equities are poised for gains.

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