“While markets appear to have something of the summer doldrums about them, this week’s US data should help drive a bit more volatility in FX. June CPI data today are expected to rise 0.3% in the month, according to the street (Scotia forecasts +0.2%), for a 2.6% gain in the year (up from 2.4% in May). Core prices are also forecast to rise 0.3% for a 2.9% gain in the year (also up from May’s 2.8%). Sticky prices will support the Fed’s reluctance to even consider easing policy while there is still so much uncertainty around where tariffs will land (and what the impact on price trends will be ultimately).”
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