Analysts at UOB Group noted that US September headline CPI inflation was up by 0.3%m/m, the fastest pace in five months.
"...Reflecting increases in the prices of fuel and housing. Compared to 1 year ago, CPI inflation was 1.5%y/y (from 1.1% in Aug). However, the core CPI inflation picked up just 0.1%m/m in September (below the expected 0.2%m/m increase) while compared to one year ago, core inflation was at 2.2%y/y in Sep (down from 2.3% in Aug). The markets pared back the chances of a Dec Fed rate hike after the CPI data release. Based on trading in futures and options data compiled by Bloomberg, the probability of another Fed rate hike in November is unchanged at 17.1% on 18 Oct but the probability of a hike by December FOMC is now a bit lower at 62.6% on 18 Oct (from 65.9% on 17 Oct)."
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