It’s been a lively day in global markets as traders from both sides of the Atlantic reacted to a dire set of inflation data in the world’s largest economy.

The US consumer price index (CPI) jumped 3.5 per cent last month, according to figures released yesterday from the Department of Labor. That’s up from 3.2 per cent in February and higher than the 3.4 per cent Wall Street economists had forecast for March.

Even more worryingly, core inflation – which removes volatile items including energy and food and is considered a better indicator of underlying inflationary pressures – also rose by more than expected last month, to 3.6 per cent.