Investors await July’s US inflation figures, which could sway Fed rate decisions amid mixed global market movements.
Markets remain on edge as the US July CPI report approaches, with traders parsing its potential impact on Federal Reserve policy. Futures suggest a cautious tone, with S&P 500 contracts up 0.3% and US 10-year yields dipping 2.4 bps to 4.66%. Gold and Bitcoin rose 1.1% and 0.8% to $4,413 and $64,188, respectively, while WTI crude steadied at $83.18 after earlier dipping to $82.50.
Expectations for the CPI print vary, but consensus points to a modest slowdown in inflation, following Germany’s confirmed acceleration in July and Italy’s slight easing. Fed policymaker Susan Collins indicated support for a September rate hike if data aligns, adding to the report’s significance. The BoJ is also in focus, with markets pricing in a potential September rate increase.
Currency markets showed muted reactions, with USD flat and NZD underperforming. European indices edged higher, reflecting a tentative risk-on sentiment before the CPI release.