The Dow dived 178.11 points today to 13,339.85 after a 0.8% spike in the consumer price index, the biggest since September 2005, sparked concern that the era of rate cuts might be over. Inflation was “the 800-pound gorilla in the room,” one strategist told the Journal. The Nasdaq slid 32.75 to 2,635.74, and the S&P 500 fell 20.46 to 1,467.95.
There was even talk of rising interest rates: One strategist sniped about the “inflation hawks” on the Board of Governors. The Dow fell 2.1% for the week, the largest weekly drop in 2 months, MarketWatch reports. Meanwhile, investors were relieved that Citigroup took steps to balance its books, and the dollar rebounded as interest rates looked less fickle.