U.S inflation data

Full coverage of the July CPI report and the markets.

The US consumer price index rose by 8.5 per cent year-on-year in July, a slower annual increase compared to June, as inflationary pressures eased on the ...

The inflation data reflected the lower energy prices, which could take some pressure off the Federal Reserve to continue aggressively hiking interest rates.

Shelter costs — which are the biggest services’ component and make up about a third of the overall CPI index — rose 0.5 percent from June and 5.7 percent from last year, the most since 1991. The impact of inflation on wages has started to dent spending, with the pace of personal consumption growth decelerating between the first and second quarters. That reflected a 0.7 percent jump in rent of primary of residence. After data last week showed still-robust labor demand and firmer wage growth, a further deceleration in inflation could take some of the urgency off the Fed to extend outsize interest-rate hikes. Utility prices fell 3.6 percent from June, the most since May 2009. But annual inflation remains high at more than 8 percent and food costs continue to rise, providing little relief for President Joe Biden and the Democrats ahead of midterm elections.

Wall Street equities rallied and Treasury yields plunged after signs of sharply decelerating U.S. inflation prompted bets that the Federal Reserve would ...

Register now for FREE unlimited access to Reuters.com Is this a solid indication inflation is waning? read more Register now for FREE unlimited access to Reuters.com Register now for FREE unlimited access to Reuters.com read more read more On the other hand assuming this data doesn't get revised its certainly good news for the economy," said Tim Ghriskey, senior investment strategist at Ingalls & Snyder in New York. In currencies, the dollar index fell 1.1%, with the euro up 1.01% to $1.0314. read more

Consumer prices jumped 8.5% in July compared with a year earlier, the government said Wednesday, down from a 9.1% year-over-year jump in June.

Such expectations can be self-fulfilling: If people believe inflation will stay high or worsen, they are likely to take steps — such as demanding higher pay — that can then send prices higher in a self-perpetuating cycle. But a survey by the Federal Reserve Bank of New York, released Monday, showed that Americans now expect lower inflation in the next few years than they did a month ago. “It's a modestly good sign," Ma said of the inflation expectations data. The average price fell to about $4.20 by the end of July and was just $4.03 by Tuesday. The continuing drop means that lower gas prices will likely pull inflation down further in August. The Fed has raised its benchmark short-term rate at its past four rate-setting meetings, including a three-quarter point hike in both June and July — the first increases that large since 1994. And a drop in Americans' expectations for future inflation may also keep higher prices from becoming entrenched. Federal Reserve Chair Jerome Powell has said the Fed needs to see a series of declining monthly core inflation readings before it would considering pausing its interest rate increases. On Friday, the House is poised to give final congressional approval to a revived tax-and-climate package pushed by Biden and Democratic lawmakers. There have been other hopeful signs, too, that the pace of inflation may be moderating. But excluding the volatile food and energy categories, so-called core inflation likely stayed high. Core CPI was forecast to rise 0.5% from June and 6.1% from a year ago. Price changes in services tend to be sticky and don't ease as quickly as they do for gas, food or other goods.

Consumer price index reading raises hopes of slower pace of Fed rate increases.

A higher-than-expected U.S. Consumer Price Index report for July could spook markets, which are already expecting a high chance of a 75 basis point interest ...

The Dutch company said it was postponing plans for an initial public offering (IPO) of its non-food retailer, Bol.com, because of unfavourable market conditions. - 3 - 2

The dollar also tumbled after U.S. data showed that consumer prices did not rise in July as the cost of gasoline fell, delivering the first notable sign of ...

It had charged higher and broke above the key $1,800 level right after the inflation data before leveling off. Is this a solid indication inflation is waning? "The downside miss is certainly not something the markets were positioned for, I think the market was really one way positioned for a higher inflation print and higher Fed pricing, said TD Securities' Goldberg. On the other hand assuming this data doesn't get revised its certainly good news for the economy," said Tim Ghriskey, senior investment strategist at Ingalls & Snyder in New York. U.S. crude recently fell 0.92% to $89.67 per barrel and Brent was at $95.40, down 0.94% on the day. "Theres still quite a bit of data between now and September...weve only gotten one out of two CPI prints before then and weve got another payroll print as well and a full set of data effectively for August, so I think the jurys still very much out on September, said Gennadiy Goldberg, interest rate strategist at TD Securities in New York. The Fed will also take into account more inflation readings and August jobs data before deciding on the size of its next rate hike at the September meeting. The sharp drop in Treasury yields indicates that traders were likely positioned for a larger inflation increase. In Treasuries, Benchmark 10-year notes last rose 21/32 in price to yield 2.7225%, from 2.797% late on Tuesday. The 2-year note last rose 10/32 in price to yield 3.1191%, from 3.286%. "It's quite a surprise and that's why the market is reacting so positively. The dollar also tumbled after U.S. data showed that consumer prices did not rise in July as the cost of gasoline fell, delivering the first notable sign of relief for Americans who have watched inflation soar over the past two years. Wall Street equities rallied and Treasury yields plunged after signs of sharply decelerating U.S. inflation prompted bets that the Federal Reserve would raise rates at a slower pace than previously expected.

Most Treasury yields fall sharply after a better-than-expected U.S. inflation report for July.

That was down to 37.5% and the chances of a 50 basis point hike were 62.5%, according to the CME FedWatch Tool. But it’s a start and we expect to see broader signs of easing price pressures over the next few months.” Before the report was released traders were giving a 67.5% chance of a 75 basis point rate hike at the Fed’s September meeting. The U.S. consumer price index (CPI) report released on Wednesday showed year-on-year inflation in July of 8.5%, down from 9.1% in June and below the 8.7% forecast by economists. Meanwhile, Chicago Fed President Charles Evans said the U.S. July consumer inflation data was “positive,” but “nobody can be happy” about an 8.5% annual headline CPI rate. It was the first time since April that the CPI report “brought unexpected good news on inflation,” said FHN Financial’s chief economist Chris Low. And Minneapolis Fed President Neel Kashkari said that the Fed is “far, far away from declaring victory.” That’s the largest one-day decline since Aug. 4, based on 3 p.m. yields, according to Dow Jones Market Data. “The deceleration in the Consumer Price Index for July is likely a big relief for the Federal Reserve, especially since the Fed insisted that inflation was transitory, which was incorrect,” said Nancy Davis, founder of Quadratic Capital Management. - The yield on the 10-year TreasuryTMUBMUSD10Y,retreated 1.1 basis points to 2.786% from 2.797% late Tuesday. The yield is off 69.6 basis points from its cycle high reached on June 14. - The yield on the 30-year TreasuryTMUBMUSD30Y,rose 3.7 basis points to 3.041% from 3.004% on Tuesday. - The yield on the 2-year TreasuryTMUBMUSD02Y,declined 7 basis points to 3.214% from 3.284% on Tuesday afternoon.

Economists polled by Reuters had forecast a 0.2% rise in the monthly Consumer Price Index (CPI) on the heels of a roughly 20% drop in the cost of gasoline.

Register now for FREE unlimited access to Reuters.com "A broad 130-135 range may be the new normal." read more Register now for FREE unlimited access to Reuters.com read more Register now for FREE unlimited access to Reuters.com

Economists polled by Reuters had forecast a 0.2% rise on the heels of a roughly 20% drop in the cost of gasoline.

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The dollar fell more than 1 percent on Wednesday following a cooler-than-expected inflation report for July that raised expectations of a less aggressive ...

The Reserve Bank of India on Wednesday said disbursal of loans and collection of repayments must be executed only between borrowers and entities regulated by it, and that no third party should be involved in this process. The Enforcement Directorate (ED) is probing at least ten cryptocurrency exchanges for allegedly laundering more than ₹1,000 crore identified as proceeds of crime of the accused firms under investigation in the instant loan app case in which most have a China link, said people aware of the matter.AIFs Due for Closure Struggle to Sell Holdings in Startup Firms Alternative Investment Funds (AIFs) that are scheduled to wind up in the next few months have been struggling to sell their holdings in unlisted ventures and startups, as investors stay clear of risky investments due to tightening liquidity.New RBI Norms Keep 3rd Party Out of Digital Lending Process The Australian dollar, seen as a barometer of risk, was up 1.32% at $0.7054. The dollar index, which measures the currency's value against a basket of currencies, was down 1.128% at 105.15 at 9:00 a.m. Eastern time (1300 Economists polled by Reuters had forecast a 0.2% rise on the heels of a roughly 20% drop in the cost of gasoline.

It has been a trendless week for the dollar so far. Today sees the biggest data event risk of the week – and probably of the month, The Consumer Price.

The author makes no representations as to the accuracy, completeness, or suitability of this information. The author has not received compensation for writing this article, other than from FXStreet. The author will not be held responsible for information that is found at the end of links posted on this page. It also does not guarantee that this information is of a timely nature. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It should also support pricing in the US money market curve that sees the policy rate taken around 125 bps higher in this cycle.”

Even if consumer inflation were to slow to 4 per cent - less than half its current level - Pugliese suggested that it would still likely cause the Fed to ...

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