【CPI and PPI are due this week, putting rate-hike expectations to the test】
The U.S. September CPI and PPI reports are due on Wednesday and Thursday, respectively. They are the most important data releases before the Fed’s October policy meeting.
Markets expect headline CPI to rebound to around 3.6% as energy prices rise, while core CPI remains near 2.4%. Markets currently price in an roughly 82% chance that rates will be held steady in October and an approximately 84% chance of one rate hike in December.
Officials’ stance is clear: a rate hike is necessary, but there’s no need to rush. Core CPI is the key measure—a reading above 0.3% could boost expectations of an October hike, while one below 0.2% would reinforce expectations of another hike in December.
In short: rates will most likely stay put in October; December is the real test.
#cpi #PPI
The U.S. September CPI and PPI reports are due on Wednesday and Thursday, respectively. They are the most important data releases before the Fed’s October policy meeting.
Markets expect headline CPI to rebound to around 3.6% as energy prices rise, while core CPI remains near 2.4%. Markets currently price in an roughly 82% chance that rates will be held steady in October and an approximately 84% chance of one rate hike in December.
Officials’ stance is clear: a rate hike is necessary, but there’s no need to rush. Core CPI is the key measure—a reading above 0.3% could boost expectations of an October hike, while one below 0.2% would reinforce expectations of another hike in December.
In short: rates will most likely stay put in October; December is the real test.
#cpi #PPI