Stocks And Dollar Swing As Inflation Data Reignites Policy Uncertainty

Global markets saw heightened volatility after fresh inflation data complicated expectations around the pace of monetary easing in 2026. While headline inflation continued to moderate, underlying price pressures proved stickier than anticipated, prompting a reassessment of central-bank timelines.

U.S. equities initially sold off before stabilizing, with rate-sensitive sectors such as technology and real estate leading the swings. Investors appeared torn between optimism over slowing inflation and concern that central banks may move more cautiously than markets had priced in.

Treasury yields pushed higher following the release, pressuring equity valuations and lending support to the U.S. dollar. The dollar strengthened against the euro and pound, while emerging-market and commodity-linked currencies came under renewed pressure.

Gold retreated from recent highs as real yields rose, though the broader bullish structure remained intact amid ongoing macro uncertainty. Oil prices were mixed, balancing demand concerns against supply discipline from major producers.

For traders, the takeaway was clear: while the easing cycle is still expected, the path will likely be uneven. Markets are entering a phase where each inflation print matters, increasing the risk of sharp repricing across equities, FX, and commodities as 2026 unfolds.