Higher for longer

US consumer prices advanced for a second month, likely reinforcing the Federal Reserve’s stated intent to keep interest rates high to further slow inflation. The so-called core consumer price index, which excludes food and energy costs, increased 0.3% in September, Bureau of Labor Statistics data showed Thursday. Economists favor the core gauge as a better indicator of underlying inflation than the overall CPI. That latter climbed 0.4%, boosted by energy costs. Recent inflation data underscore how a strong labor market continues to drive consumer demand, which may keep price pressures above the Fed’s 2% target. —David E. Rovella

Stocks fell and Treasury yields rose on the news and its implications for interest rates. The S&P 500 halted a four-day advance as bank shares underperformed ahead of results from JPMorgan, Citigroup and Wells Fargo tomorrow. The dollar gained the most in five weeks. “At this point, ‘higher-for-longer’ may be more important than ‘how high?’” said Richard Flynn, managing director at Charles Schwab UK. Here’s your markets wrap.

All year, Wall Street players have been sinking record sums of cash into the world’s largest Treasury exchange-traded fund in a bet that interest rates have peaked. All year they’ve been wrong, with an estimated $10 billion in losses. But some are still buying. Here’s why.

Sri Lanka is likely to clinch an agreement in the next several days that would help it tap more funds from the International Monetary Fund even though it’s still trying to firm up negotiations with creditors on debt restructuring.

The US reached an informal understanding with Qatar to hold off distributing $6 billion in oil revenue that Iran was allowed to access under a prisoner exchange. The Biden administration has said that intelligence agencies have no evidence to show Iran directed last weekend’s attack on Israel, but they reportedly believe Tehran knew Hamas was plotting some action. (Republicans had sought to make the frozen assets a political issue.) On Thursday, Syria says Israel attacked two of its airports and Tel Aviv continued its bombing campaign in Gaza. Israel’s military said it has confirmed that at least 97 people were taken hostage when Hamas attacked, and Hamas has threatened to kill hostages if Gaza is attacked without warning. Israelis continue to mourn the 1,200 people authorities said were killed in the surprise attack as local authorities reported more than 1,000 people killed in Gaza this week, where the United Nations is warning of a looming humanitarian disaster.

Intel Chief Executive Officer Pat Gelsinger has embarked on one of the largest factory-building sprees in chip-industry history, part of an audacious plan to revitalize the Silicon Valley pioneer. But he’s missing a key ingredient: enough paying customers.

As the unprecedented strike by the United Auto Workers nears the one-month mark, it’s become clear the battle isn’t just about wages, benefits and sacrifices workers made to keep US automakers afloat during the financial crisis. What’s also at stake is who will suffer the most pain as America transitions from gasoline-powered to electric vehicles. Watch the Bloomberg Originals min-documentary Detroit’s Electric Reckoning.

Formula One mogul Bernie Ecclestone pleaded guilty to a criminal tax fraud charge and was handed a suspended prison sentence for failing to tell British authorities about assets held in a Singapore bank of around £400 million ($492 million). In a dramatic reversal, just weeks before the 92-year-old was due to stand trial, Ecclestone agreed to a £652 million tax settlement that covers an 18 year period.

Pakistan’s government spending, political instability and seeming addiction to debt have helped push the South Asian nation’s economy to the brink of ruin. Earlier this year, Pakistan was on the verge of default before it secured yet another lifeline from the International Monetary Fund. In the Bloomberg Originals short video Pakistan’s Endless Economic Crisis, we show how, with the added pressure of inflation and climate disasters, a bad situation has been getting steadily worse.

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