Wednesday’s inflation report may confirm or reverse the Fed rate-cut repricing sparked by July’s 23K job loss.
The US Dollar Index slid below 100.00 after July Nonfarm Payrolls showed a 23K job decline, missing forecasts of an 80K gain. June’s figure was revised down to 20K, and annual wage growth slowed to 3.2%.
Markets had priced in a hawkish Fed in late July but reversed course after the payrolls miss. Consensus expects Wednesday’s CPI at 3.4% YoY headline and 2.5% core, with PPI, Retail Sales, and Michigan Sentiment due later in the week.
Two Fed speakers, Hammack and Barkin, are scheduled for Thursday. The RBA meets Tuesday, and UK Q2 GDP data arrives Thursday, while China’s inflation figures open the week on Sunday.