NEW YORK, January 13, 2026, 14:57 (EST)
- U.S. indexes slip as financials drag; Visa and Mastercard slide on credit-card rate-cap worries
- December CPI rises 0.3%; annual inflation holds at 2.7%; core inflation runs at 2.6%
- Traders keep bets on rate cuts later this year, but timing stays the question
U.S. stock indexes slipped on Tuesday as financials dragged after JPMorgan warned that a proposed cap on credit-card interest rates could hit consumers, hammering payment stocks. At 11:28 a.m. ET, the Dow Jones Industrial Average was down 338.22 points, or 0.68%, the S&P 500 fell 0.29% and the Nasdaq Composite dropped 0.21%. Visa slid 4.7% and Mastercard sank 5.3%, and traders still priced in at least two 25-basis-point cuts later this year (a quarter of a percentage point); “The Fed is likely to take its time and absorb more data,” said Skyler Weinand, chief investment officer at Regan Capital. (Reuters)
The fresh inflation data is one of the last big inputs for policymakers and investors before the Federal Reserve meets later this month. With the S&P 500 and Dow hovering near record highs, even a small wobble in rate expectations can spill into valuations, especially for rate-sensitive sectors.
The Consumer Price Index (CPI) rose 0.3% in December and was up 2.7% from a year earlier, the Labor Department said. Core CPI, which excludes food and energy, increased 0.2% on the month and 2.6% on the year, while the shelter index climbed 0.4% and food prices jumped 0.7%. (Bureau of Labor Statistics)
But the headline number doesn’t tell you what shoppers see in the aisle: Reuters reported food prices posted their biggest monthly gain since 2022, and steak prices were up 17.8% from a year earlier. “They see grocery prices and restaurant costs immediately,” said Sung Won Sohn, a finance and economics professor at Loyola Marymount University. Stephen Stanley, chief U.S. economist at Santander U.S. Capital Markets, pointed to a pattern of hotter January readings that could keep policymakers cautious. (Reuters)
U.S. Treasury yields dipped after the report, with the 10-year yield last around 4.171%, and the dollar index pared gains to 98.93. “Inflation isn’t reheating, but it remains above target,” said Ellen Zentner, chief economic strategist at Morgan Stanley Wealth Management, adding the data did not yet clear the way for a near-term cut. (Reuters)
President Donald Trump has pushed publicly for faster rate cuts while rolling out measures aimed at household costs, including a cap on credit-card interest rates and a ban on large institutional investors buying single-family homes, the Guardian reported. Trump was due to speak about the economy in Detroit later on Tuesday. (The Guardian)
Some economists see the tariff hit showing up more slowly than feared. “We’re finishing the year in a more benign stance than where we started,” Tom Porcelli, chief economist at Wells Fargo, told the Wall Street Journal. Even so, inflation remains above the Fed’s 2% goal and investors are bracing for more uneven prints as 2026 gets moving. (The Wall Street Journal)
For Wall Street, focus now shifts to the rest of earnings season and how Washington’s affordability push filters into consumer credit. Any hint that inflation is re-accelerating would test a market that has been priced for easier money.
