‘Our Worst Nightmare!’ CNBC Anchors Watch Stocks ‘Tank’ As Price Inflation Report Comes In Hot Even Before Trump Tariffs
CNBC anchors Becky Quick and Joe Kernen were alarmed as stock futures “tanked” — as Rick Santelli reported “hot” numbers showing a worse-than-expected CPI in the January inflation report, which Kernen called “our worst nightmare!”
The Bureau of Labor Statistics published its CPI (Consumer Price Index) report on Wednesday morning, which showed worse-than-expected numbers:
The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.5 percent on a seasonally adjusted basis in
January, after rising 0.4 percent in December, the U.S. Bureau of Labor Statistics reported today. Over the last
12 months, the all items index increased 3.0 percent before seasonal adjustment.…
The all items index rose 3.0 percent for the 12 months ending January, after rising 2.9 percent over the 12 months
ending December. The all items less food and energy index rose 3.3 percent over the last 12 months. The energy
index increased 1.0 percent for the 12 months ending January. The food index increased 2.5 percent over the last
year.
On Wednesday’s edition of CNBC’s Squawk Box, Quick introduced Santelli by announcing that “futures are tanking” and after he read the news, Kernan noted that this higher inflation comes before President Donald Trump’s tariffs, which are widely expected to be inflationary in at least the short term:
BECKY QUICK: David. I’m sorry we did it. The futures are tanking based on some data that’s out right now. You’re now looking at the Dow futures off by 222 points. Let’s get right to Rick Santelli. He has that CPI number.
RICK SANTELLI: Yes, it’s hot data!
…
BECKY QUICK: All right. Stay with us. Let’s very quickly look through these boards. Again, as Rick was pointing out, we looked at the equities tank.
You’re now looking at the Dow futures off by about 400 points, just over 400 points. S&P futures are down by 57. Nasdaq indicator down by more than 220 points. If you’ve been watching treasuries. We did see a very significant tick up in treasuries as well. The ten year which was trading, I think at about 453 this morning where we started. So all the way up to 461, the two years at 437.
Joining us right now for more on this information is Priya Misra. She is the fixed income portfolio manager at JP Morgan Asset Management. Drew Matus is the head of Global Economic and markets strategy team at MetLife Investment Management. Drew, let’s just start with you. Markets didn’t like this.
DREW MATUS: No. You know, the focus was going to be on the core year over year three. Two would have been bad. And what we got was worse. Right. So, you know, it’s really disappointing news for the Fed that they were hoping for is a continued deceleration. It’s disappointing for the market because they’re hoping for continued deceleration. And the fact that this is a January number and doesn’t include any potential tariff impact yet, you know, means that, you know, the risk going forward is for potentially higher inflation.
BECKY QUICK: It comes just after Donald Trump put out on Truth Social the idea that the Fed should be lowering rates to go along with the tariffs that we could be at this time. This puts the Fed in a pretty tight box. It’s hard pressed for them to be able to lower rates at this point.
DREW MATUS: Well, it does. I mean, you need to you know, they shouldn’t have been lowering rates in the first place. So that’s they kind of got themselves into a box. They tried to get in front of things heading into the election and they went a little too far, too fast. And then they continued easing even when, you know, everything should have been telling them that they should have been stop it.
JOE KERNEN: This is that nascent inflation that we were worried was was, you know, in the back of our minds, we were worried that it was still there. Isn’t that what that what we’re seeing right now?
This is like our worst nightmare coming true! We didn’t do anything! We didn’t do any tariffs yet! This is this was already coming.
Watch above via CNBC’s Squawk Box.
