US Dollar Index (DXY) consolidates around 99.00 with all eyes on the US CPI
- The US Dollar consolidates gains within a narrow range around 99.00.
- Investors await the release of the US CPI, due later today, to make investment decisions.
- Later on, preliminary US PMI data is expected to show healthy business activity.
The US Dollar is consolidating previous gains on Friday, trading within a 40-pip range, both sides of the 99.00 line, with investors looking from the sidelines ahead of the release of September’s US Consumer Prices Index report, due later on the day.
The US Bureau of Labour will make an exception and release September’s inflation figures, despite the ongoing US government shutdown, to provide the Social Security Administration with the necessary data to calculate the annual cost-of-living adjustment in order to manage benefits and subsidies.
US CPI is expected to show higher price pressures
The market consensus anticipates a further acceleration of price pressures, with the yearly CPI rising to 3.1% from 2.8% in August. However, the core CPI, more relevant for the Federal Reserve’s rate-setting purposes, is expected to have continued growing at a 3.1% yearly rate, unchanged from the previous month.
The primary focus remains on next week’s Fed meeting, which is widely expected to conclude with a 25-basis-point rate cut, no matter the outcome of today’s CPI release. An upside surprise in inflation, however, might revive fears of tariffs-induced inflation risks, cast doubt on a December rate cut, and provide an additional impulse to the US Dollar.
Apart from that, investors will also be attentive to the preliminary US S&P Global Purchasing Managers’ Index (PMI) data for further clues about the strength of the US economy. The market consensus points to a steady growth in the manufacturing sector and a moderate slowdown in services, all in all, reflecting a healthy business activity.
Economic Indicator
Consumer Price Index (YoY)
Inflationary or deflationary tendencies are measured by periodically summing the prices of a basket of representative goods and services and presenting the data as The Consumer Price Index (CPI). CPI data is compiled on a monthly basis and released by the US Department of Labor Statistics. The YoY reading compares the prices of goods in the reference month to the same month a year earlier.The CPI is a key indicator to measure inflation and changes in purchasing trends. Generally speaking, a high reading is seen as bullish for the US Dollar (USD), while a low reading is seen as bearish.
Read more.Next release: Fri Oct 24, 2025 12:30
Frequency: Monthly
Consensus: 3.1%
Previous: 2.9%
Source: US Bureau of Labor Statistics
The US Federal Reserve (Fed) has a dual mandate of maintaining price stability and maximum employment. According to such mandate, inflation should be at around 2% YoY and has become the weakest pillar of the central bank’s directive ever since the world suffered a pandemic, which extends to these days. Price pressures keep rising amid supply-chain issues and bottlenecks, with the Consumer Price Index (CPI) hanging at multi-decade highs. The Fed has already taken measures to tame inflation and is expected to maintain an aggressive stance in the foreseeable future.
Economic Indicator
Consumer Price Index (MoM)
Inflationary or deflationary tendencies are measured by periodically summing the prices of a basket of representative goods and services and presenting the data as The Consumer Price Index (CPI). CPI data is compiled on a monthly basis and released by the US Department of Labor Statistics. The MoM figure compares the prices of goods in the reference month to the previous month.The CPI is a key indicator to measure inflation and changes in purchasing trends. Generally, a high reading is seen as bullish for the US Dollar (USD), while a low reading is seen as bearish.
Read more.Last release: Thu Sep 11, 2025 12:30
Frequency: Monthly
Actual: 0.4%
Consensus: 0.3%
Previous: 0.2%
Source: US Bureau of Labor Statistics
The US Federal Reserve (Fed) has a dual mandate of maintaining price stability and maximum employment. According to such mandate, inflation should be at around 2% YoY and has become the weakest pillar of the central bank’s directive ever since the world suffered a pandemic, which extends to these days. Price pressures keep rising amid supply-chain issues and bottlenecks, with the Consumer Price Index (CPI) hanging at multi-decade highs. The Fed has already taken measures to tame inflation and is expected to maintain an aggressive stance in the foreseeable future.
Author
Guillermo Alcala
FXStreet
Graduated in Communication Sciences at the Universidad del Pais Vasco and Universiteit van Amsterdam, Guillermo has been working as financial news editor and copywriter in diverse Forex-related firms, like FXStreet and Kantox.
