US core CPI rises less than forecasts predicted: The US’ annual core consumer price index (CPI) — which excludes the food and energy baskets — rose by 0.2%, the slowest pace in six months, according to the US Bureau of Labor Statistics report (pdf). Forecasts had predicted a fifth consecutive 0.3% rise.

The Fed needs more proof to speed up cuts: This development will not merit a rate cut in the next Federal Reserve meeting later this month, but if next month turns up with another “soft CPI print” and a "weakening in payrolls” then a March rate cut is plausible, chief global strategist at Principal Asset Management Seema Shah tells Bloomberg.

Still, all options are on the table: The current pricing patterns and future predictions indicate a 50-50 chance of two rate cuts throughout 2025 by 25 bps, with markets expecting the next cut to take place in May or June, CNBC reports.

Growth levels of jobs and wages support a longer hold on cuts, as the US economy added 256k jobs in December, according to data from the Bureau of Labor Statistics. The unemployment rate declined to 4.1%, one-tenth of a point below expectations, CNBC reports.

Trump’s policies might pressure inflation: Some economists predict that Donald Trump’s tariffs will put extra pressure on inflation after his inauguration next week. Trump vowed to impose a 60% tariff on Chinese goods, followed by an additional 10%, as well as a 10% tariff on imports from other countries, denying any intentions to water down the rates.

Market reax: All three major indices closed down yesterday, despite rallying at the start of the trading day.

MARKETS THIS MORNING-

Asian markets are broadly in the red in early morning trading, with the exception of the Shanghai Index. It’s a different story for US futures, which are indicating the S&P 500, Dow Jones, and Nasdaq will all open in the green after falling yesterday.

ADX

9,506

-0.1% (YTD: +0.9%)

DFM

5,236

-0.3% (YTD: +1.5%)

Nasdaq Dubai UAE20

4283

-0.2% (YTD: +2.9%)

USD : AED CBUAE

Buy 3.67

Sell 3.67

EIBOR

4.1% o/n

4.4% 1 yr

TASI

12,256

+0.4% (YTD: +1.8%)

EGX30

29,605

+0.7% (YTD: -0.5%)

S&P 500

5,937

-0.2% (YTD: +1.0%)

FTSE 100

8,391

+1.1% (YTD: +2.7%)

Euro Stoxx 50

5,106

+1.5% (YTD: +4.3%)

Brent crude

USD 81.49

+0.3%

Natural gas (Nymex)

USD 4.27

+0.3%

Gold

USD 2,714.69

0%

BTC

USD 101,606.4

+1.2% (YTD: +8.7%)

THE CLOSING BELL-

The DFM fell 0.3% yesterday on turnover of AED 697.6 mn. The index is up 1.5% YTD.

In the green: National Industries Group Holding (+11.1%), National Cement Company (+9.2%) and National General Insurance Company (+8.9%).

In the red: Sukoon Takaful (-10.0%), Agility The Public Warehousing Company (-5.6%) and Dubai Electricity & Water Authority (-3.9%).

Over on the ADX, the index fell 0.1% on turnover of AED 1.2 bn. Meanwhile, Nasdaq Dubai fell 0.2%.

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