Stocks Hit Record Highs Despite Inflation Concerns, Jobless Claims Rise
Westminster, CA – September 12, 2025 – U.S. stock markets surged to all-time highs yesterday, a seemingly counterintuitive move given the release of hotter-than-expected inflation data. The dow, S&P 500, and Nasdaq all closed at record levels, fueled by a separate report indicating a significant rise in weekly jobless claims – a signal that the Federal Reserve may be poised to cut interest rates.
The Labor Department reported that the Consumer Price Index (CPI) rose more sharply than anticipated in August, confirming fears that tariffs are contributing to inflationary pressures. While the annual headline inflation rate and core data met expectations, the monthly increase exceeded forecasts by 0.1 percentage point.
Though, the positive market reaction stemmed from a concurrent report showing jobless claims reaching their highest level in nearly four years. This data point has led many analysts to believe the Fed will implement at least a 25 basis point rate cut at its upcoming meeting.
“TodayS CPI report has been trumped by the jobless claims report,” noted Seema Shah, chief global strategist at Principal Asset Management. “This reinforces the narrative that the U.S. Federal Reserve will lower rates during its meeting next week.”
Key Takeaways:
* Record highs: All three major U.S. stock indexes closed at record highs on Wednesday.
* Inflationary Pressure: August CPI data showed a sharper-than-expected month-on-month increase, indicating tariffs may be fueling inflation.
* Rising Jobless claims: Weekly jobless claims rose to a nearly four-year high,bolstering expectations of a Fed rate cut.
* Fed Watch: Investors are keenly awaiting Chair Jerome Powell’s commentary on the economy and future monetary policy alongside any potential rate adjustments.
Trump Escalates Trade Pressure on Europe
in a separate development, reports surfaced that former President Donald Trump has urged the European Union to impose substantial tariffs - up to 100% – on imports from India and China, citing their continued purchases of Russian oil. Analysts suggest the EU is unlikely to comply with the request, potentially setting the stage for further transatlantic trade tensions.
[Image of shoppers at the new H Mart in Westminster, CA, on August 7, 2025. Caption: Shoppers at the new H Mart during their grand opening in Westminster, CA, on Thursday, August 7, 2025. Jeff Gritchen | Medianews Group | Getty Images]
[Image of Donald Trump and Ursula von der Leyen shaking hands. Caption: U.S. President Donald Trump and President of the European Commission Ursula von der Leyen shake hands as they announce a US-EU trade deal after a meeting at Trump Turnberry golf club on July 27, 2025 in Turnberry, Scotland.Andrew Harnik | Getty Images News | Getty Images]
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