US: August CPI to show consumers received further relief – Wells Fargo
|On Tuesday, key inflation data is due in the US. The August CPI print will be watched closely by market participants ahead of the next FOMC meeting to be held September 20-21. According to analysts at Wells Fargo, the CPI will show a decline of 0.2% in August, on the back of a further plunge in gasoline prices.
Key Quotes:
“Consumer price inflation surprised to the downside in July, driven by a big drop in energy prices and a sharp slowdown in both core goods and services. We expect Tuesday's report to show consumers received further relief on the inflation front in August. Specifically, we look for prices to have declined 0.2% last month, which would be the largest monthly drop since the spring of 2020.”
“A further plunge in gasoline prices is expected to lead the headline lower, while additional giveback in travel services and used cars should help hold the core to a 0.4% month-over-month increase.”
“The FOMC has been singularly focused on inflation of late, and Tuesday's CPI print will be important in shaping the Fed's latest thinking ahead of its next meeting. While we expect the FOMC to be encouraged by the downshift in inflation since June, core prices continue to advance well ahead of the Fed's target. Lower commodity prices in recent months and easing of supply chain bottlenecks point to inflation cooling in the months ahead, but the still-strong rate of labor cost growth suggests that it will not be easy to return inflation to the Fed's target on a sustained basis.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.