In FX, major currencies are muted after the dollar fell yesterday with traders now more or less fully pricing in a 25 bps rate cut for September. Fed funds futures also show ~60 bps of rate cuts priced in by year-end currently. Here's a snapshot of dollar pairs going into the session ahead:
Elsewhere, equities are also looking fairly muted today. S&P 500 futures are flattish following a push to fresh record highs in Wall Street yesterday. There's no follow up just yet in the new day but buyers remain firmly in control as tech shares continue to stay buoyed. The AI boom continues to run its course.
On the front of it, the numbers might seem pretty alright and more or less in line with expectations. Core monthly inflation came in at 0.322%, matching estimates but is at the highest since January. Meanwhile, core annual inflation was seen at 3.059% - just a fraction higher than estimates and borderline causing the rounding to the 3.1% reading we're seeing.
Of note, core goods inflation underwhelmed with a 0.21% m/m reading, meaning it was little changed compared to June's 0.20% m/m reading. That's not particularly strong evidence of any major uptick in price pressures there.
Now, most analysts are expecting there to be a stronger uptick here in the fall months i.e. autumn. But for now at least, we still have to wait for another month to see if inflation data will prove to be scarier than it is made to be for the Fed.
The reaction among Fed policymakers are more mixed though with Kansas City Fed president Schmid saying he will dissent to a rate cut. Meanwhile, Fed governor nominee Miran of course says that there is no evidence at all of any tariffs passthrough and that the inflation numbers are "well behaved". Then again, he is nominated by Trump for the position so you'd expect that kind of political bias in his remarks.
This article was written by Justin Low at investinglive.com.Hence then, the article about markets quiet down after the us cpi report yesterday was published today ( ) and is available on forex live ( Middle East ) The editorial team at PressBee has edited and verified it, and it may have been modified, fully republished, or quoted. You can read and follow the updates of this news or article from its original source.
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