Finimize - 🔥 The US is hot, hot, hot

What’s going on here?

Data out on Wednesday showed that US prices crept up by more than expected last month.

What does this mean?

Economists weren’t completely blindsided by August’s hot inflation figures. After all, the rising cost of oil has sent the price at the pump skyward, so they were already expecting the headline inflation number to tick up again. But that doesn’t mean pundits had it all figured out. For one, consumer prices’ 3.7% growth – well above July’s 3.2% – was heftier than they predicted. And for another, the all-important core inflation rate (which strips out the volatile food and energy costs) wasn’t exactly the saving grace that economists crossed their fingers for. Granted, the yearly measure of the metric fell to 4.3% from July’s 4.7%. But the month-on-month jump was bigger than expected, accelerating for the first time since February.

Why should I care?

For markets: Never say die.

The inflation numbers weren’t exactly ideal, but it’s not all doom and gloom. Sure, there’s chatter that the US’s economic revival might fan the inflationary flames – but considering muted wage growth and a cooling jobs market in recent months, many are betting the Federal Reserve won’t hit the panic button just yet. And the market reaction’s actually been pretty chill too. Traders, at any rate, seemed generally unfazed by the news, still betting that the central bank will avoid hiking interest rates in its meeting next week.

Zooming out: Price and shine.

While the US is grappling with price rises, China’s celebrating them. Data out late last week showed a modest 0.1% climb in China’s consumer prices last month. And while that may sound tiny, it’s a win after the previous month’s deflationary dip. Plus, with credit demand looking perkier too, this adds to the evidence that China’s economy might be on firmer footing again, after its recent sharp downturn.

What’s going on here?

Inditex reported some decent results on Wednesday, but investors were still a little skeptical.

What does this mean?

Thousands of smaller retailers have been crumbling under the pressure of high inflation recently, but the world’s biggest fashion company is still strutting its stuff with impressive results. After all, sourcing from nearby suppliers has helped get the latest trends into shops faster than a catwalk turnaround, keeping costs down. Plus, Inditex has been trying to give its offerings a greater air of luxury to woo some wealthier shoppers too. It’s no surprise, then, that the owner of brands like Zara and Bershka reported a 40% jump in net profit for the first half of the year compared to last year. That said, investors spotted that Inditex’s sales growth started to cool off in the early weeks of this quarter. And that might be why the stock dipped by 3%.

Why should I care?

The bigger picture: Tailor-made opportunities.

Even with a hint of a slowdown, Inditex isn’t out of the growth race. The firm’s got a hefty cash stash, which means it can keep prices tempting or even slash them next year. And with global shoppers watching their wallets, and economies like the EU and UK showing signs of a slowdown, that’s a great card to be able to play. But that’s not the only opportunity: Inditex has also got plenty of room to grow in many new markets – especially if it can undercut the competition.

Zooming out: Not skirting the issue.

Shoplifting’s been on the rise lately, with tons of firms – from the UK’s John Lewis to the US’s Walmart – sounding the alarm about mysteriously dwindling stock. But Inditex isn’t just standing by. The firm’s innovating instead, swapping out old tags for new chips sewn directly into its latest collections. And if that move curbs theft, then it could be another win for the firm’s bottom line.