Markets rise, Fed “to start cutting interest rates before end of year”

Markets were mostly higher on Wednesday.

The S&P 500 rose 0.7 percent and the STOXX Europe 600 rose 0.3 percent but the Nikkei 225 fell 0.5 percent.

While the minutes of the last Federal Reserve monetary policy meeting released on Wednesday confirmed a wait-and-see stance by the US central bank, inflation data showed that US consumer prices rose 0.4 percent in March, the biggest monthly increase in 14 months.

“I think there’s a bit more inflation beneath the surface than the market has been acknowledging,” said Willie Delwiche, investment strategist with RW Baird.

However, Andrew Hunter, senior US economist at Capital Economics, noted that core inflation fell to a 13-month low and concluded: “We continue to expect that weaker activity growth will convince officials to start cutting interest rates before the end of the year.”