THE DATA that explains the drop:

The preferred measure of the Federal Reserve to gauge core inflation in the U.S. recorded its largest monthly increase since April, reinforcing the idea of slowing the pace of interest rate cuts following last month's drastic reduction.

The so-called Core Personal Consumption Expenditures (PCE) Price Index, which excludes the volatility of food and energy, increased by 0.3% in September and 2.7% a year earlier, according to data from the Bureau of Economic Analysis released this Thursday.

Overall inflation was 2.1%, the lowest since early 2021 and just above the central bank's target of 2%.

SOURCE: Bloomberg