😬 Wait, The Fed Might Hike?

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Gasoline prices jumped 9.1% in a single month.

That one line item did more than half the work in September's inflation report.

US consumer prices rose 0.6% in September, up from 0.4% in August. Wall Street expected exactly that, so no fainting on the trading floor.

Year over year, CPI hit 3.7%, up from 3.4%. The Fed's target is 2%. We're not even in the same postcode.

With wars dragging on in the Middle East and Ukraine, energy prices went vertical:

Meanwhile, the rest of the basket looked almost chill. Overall food was flat, and groceries actually fell 0.1%.

Dairy dropped 0.9%. Meat, fish and eggs slipped 0.5%. Your fridge is having a better month than your car.

Shelter rose 0.4% and used cars 0.7%. Annoying, but hardly a crisis.

So if it's mostly oil, why is the Fed suddenly twitchy?

Core CPI, which strips out food and energy, rose 0.3% versus the 0.2% expected.

Year over year, core hit 2.6%, beating the 2.5% forecast and up from 2.4% in August.

That's the tell. Energy shocks are supposed to fade. When they start seeping into everything else, the Fed can't keep shrugging it off.

Markets got the message instantly. Odds of a 0.25% rate hike in October jumped to 49.3%, from 22.1% the day before.

A coin flip that more than doubled overnight. And yes, that's a hike. Up. More expensive money.

It likely gets worse before it gets better. Last fall's government shutdown produced artificially low readings, and those are now rolling into the comparison base.

That alone pushes the annual rate higher. Swaps markets already price December CPI at roughly 3.8% to 3.9%, within spitting distance of 4%.

Next up: Thursday's Producer Price Index. A hot print could push the Fed to hike in October instead of waiting until December.

What that tends to mean in practice:

One economist's warning: the longer the war disrupts energy supplies, the more those costs leak into everything else.

The pump is just the opening act.

Nvidia's CEO calls this "the next biggest opportunity after AI." If you missed Apple before the iPhone... a run of 7,537% at its peak... this may be your second look at that kind of setup. Get the 3 ticker symbols here.

Memory chip prices just jumped up to 90% in three months.

And Elon Musk is handing out gold stars to the one supplier he reckons didn't gouge him.

Musk took to X to praise Micron $MU ( ▲ 1.87% ) for keeping its future memory pricing sensible.

His verdict: "Micron has been reasonable regarding future memory prices, while others have been extortionate."

Somebody charged Musk a fortune, and he hasn't forgotten. Fitting, for a memory-chip story.

He added that customers will remember who treated them well, and that Micron is playing the long game on loyalty.

Why does Musk care? His AI outfit xAI (now part of SpaceXAI) runs the Colossus and Colossus 2 data centers near Memphis.

Together they pull about 1 gigawatt of computing power. That's power-station territory.

And the Nvidia GPUs humming inside them run on Micron memory.

Musk was replying to an analyst post flagging a bullish JPMorgan note on Micron. The numbers are chunky:

Micron has basically sold next year's chips before making them. Imagine a bakery with a two-year waiting list for bread.

The kicker: new deals are being signed at higher prices.

JPMorgan thinks that could keep Micron's gross-margin floor above previous cycle peaks, with roughly 62% as a reference point.

That's a bold claim for an industry that usually rides cycles like a rollercoaster with no seatbelt.

The bank also expects SanDisk $SNDK ( ▼ 0.61% ) and Korean memory makers to report progress on their own long-term deals.

AI data centers are hoovering up chips.

Micron, Samsung and SK Hynix have shifted capacity toward high-bandwidth memory (HBM), because it carries fatter margins.

That leaves less regular DRAM for servers, PCs and smartphones. Supply shrinks, prices climb.

DRAM, NAND and HBM prices rose 80% to 90% in Q1 2026 versus the prior quarter.

One caveat before anyone gets carried away: no direct deal between Micron and Musk's companies has been announced.

Musk has named Micron, Samsung and TSMC as existing suppliers while talking up his Terafab chip project. A shout-out on X is still just a post.

For memory stocks, the bull case just got a new chapter: locked-in contracts at higher prices could make earnings less cyclical.

The catch? Those deals lean on AI spending staying hot. If data center budgets cool, the "new floor" theory gets tested fast.

And Musk's comment hints at something bigger: big buyers are keeping score. Suppliers who squeezed hardest during the shortage may pay for it later.

All nine of America's biggest banks just got caught "debanking."

Not some of them. All nine.

On Wednesday, the Office of the Comptroller of the Currency (OCC) said the largest U.S. banks denied or limited services to customers over their political or religious beliefs, or their perfectly legal businesses.

And Bank of America somehow had an even worse day. More on that below 👇

According to the OCC, every one of them had these policies at some point between 2020 and September 2025.

Comptroller Jonathan Gould called the findings "irrefutable evidence" of discrimination. Regulators rarely talk like that.

The main culprit: vague "reputation risk" policies with no clear standards. Basically "we'll know it when we see it," applied to your bank account.

The industries that got the cold shoulder:

Debanking has become one of Donald Trump's favourite grievances with Wall Street.

In January, he sued JPMorgan for $5 billion, claiming the bank dropped him for political reasons.

Gould says the banks have made some changes, but he's not confident they've gone far enough. The OCC will now consider further changes to the rules for the biggest banks.

The OCC, the Fed and the FDIC have already scrapped "reputational risk" from how they supervise banks.

The Treasury hit BofA with over $1.21 billion in penalties for anti-money laundering and sanctions violations.

The allegations: the bank failed to deal with and report national security risks, including Chinese money laundering networks and illicit finance along the southwest border.

Its anti-money laundering compliance program was also found to be deficient and ineffective. That's the regulatory version of a 2/10 review.

Then OFAC added an $11.66 million fine covering 475 apparent sanctions violations tied to Russia, Belarus, Iran, Burma, Somalia, narcotics and terrorism.

The highlights:

So the bank stands accused of being too picky with legal customers and not picky enough with sanctioned ones. Impressive range.

Expect banking rules to keep loosening for the "controversial" sectors. Oil, coal, firearms and crypto companies could find it easier to get banked, which helps their access to capital.

For BofA holders, the earnings call matters more than the fine. Listen for any talk of compliance spending or further regulatory heat.

Also worth watching: Trump's $5B JPMorgan lawsuit. This report hands his side some fresh ammo.