The key macroeconomic reading today is undoubtedly US CPI inflation for August. Investors are keeping a close eye on the pace of price and service growth in the economy, which is an important basis for future interest rate decisions. What can we expect from today's reading and how might it affect a future FOMC meeting?
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Create account Try a demo Download mobile app Download mobile appAt the moment, the swaps market is pricing an 88% chance of a 75 basis point hike at the next FOMC meeting (next week, September 21). Source: FOMC
U.S. retail gasoline and diesel prices have been declining quite sharply through August 2022. Interestingly, the gradual reductions in fuel prices have continued for 13 weeks in a row, and have already fallen by 26% since the peak. Source: EIA
Major U.S. financial institutions assume that headline inflation will fall to 8.1% y/y. The outlook for inflation excluding energy and food prices is slightly different. In this case, the consensus is for inflation to rise to around 6.1% y/y. Source: eFXdata
Morgan Stanley analysts believe that rising rental costs supported Core inflation growth in August.
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