US inflation surprise and all eyes on upcoming FOMC THIS WEEK IN MARKETS Inflation was supposed to be coming down by now.  After all, US gasoline prices have fallen for 89 consecutive days, as calculated by some analysts. But it was not to be. US consumer prices in August rose by another 0.1% compared to the previous month. With this inflation surprise, a majority of economists are now expecting the US Federal Reserve to raise interest rates by 1.0 percentage point (100 basis points) next week. The US stock market didn't take this very well, reversing most of the gains it made in the previous week. Closer to home, the Singapore market outperformed as higher interest rate expectations lifted sentiment on the banks. The savers amongst us also cheered the yield on the latest 6-month Singapore Treasury Bill, which reached 3.32% in the latest auction.  All eyes are now on what the Federal Reserve will do and say at its meeting next week....