Asian markets slump after US inflation hits 40-year high, Fed rate hike hangs in balance

STOCK markets across South-east Asia tumbled on Monday (Jun 13), after news that the US inflation rate in May hit a 4-decade high on Friday, in a development that has now put pressure on the US Federal Reserve to raise interest rates further.

Inflation in the US rose 8.6 per cent in May from the corresponding month last year. The Consumer Price Index for all products also rose 1 per cent in May from April, due largely to higher prices of food, gas and shelter.

“Asian equity markets are taking some serious selling pressure,” said Oanda’s senior market analyst Jeffrey Halley.