A Jian is wrapping up with a preview of tonight’s CPI report. Following last week’s strong nonfarm payrolls data, Reuters reported today that the market-implied probability of a rate hike in December has reached about 85%. The market currently expects headline CPI to rise 3.9% year over year and core CPI to rise 2.8%. If tonight’s inflation data comes in above expectations, markets may price in even tighter monetary policy.
But if CPI comes in below expectations, that doesn’t necessarily mean risk assets will rebound right away. We’ll also need to see how core inflation, the U.S. dollar, and Treasury yields react. So the main significance of this CPI report is to determine whether the market needs to readjust to an environment of higher interest rates and more expensive capital.
That’s all. DYOR#CPI前瞻，12月利率走向迎关键考验
But if CPI comes in below expectations, that doesn’t necessarily mean risk assets will rebound right away. We’ll also need to see how core inflation, the U.S. dollar, and Treasury yields react. So the main significance of this CPI report is to determine whether the market needs to readjust to an environment of higher interest rates and more expensive capital.
That’s all. DYOR#CPI前瞻，12月利率走向迎关键考验