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June CPI and Fed testimony set the week’s FX, yields focus
June CPI is forecast to cool, with headline inflation seen at 3.8% year over year and core CPI at 2.8%, while Fed Chair Kevin Warsh testifies Tuesday and Wednesday.
Forexlive highlights a heavy US macro calendar that could swing Federal Reserve expectations and boost volatility across the US dollar, Treasury yields, equities, and precious metals. The week is led by Tuesday’s June CPI release at 8:30 AM ET, with inflation still the key input for how soon the Fed could shift away from its current stance.
Economists expect headline CPI to rise 0.1% month over month, down from 0.5% in May, which would be the softest monthly reading since June 2025. On an annual basis, headline CPI is forecast to slow to 3.8% from 4.2%, while core CPI is expected to rise 0.2% month over month and ease to 2.8% year over year from 2.9%.
The CPI outcome is also framed as a potential tone-setter for the rest of the week. A softer print would likely reinforce views that the Fed can remain on hold and eventually move toward easing, a mix that could weigh on the dollar and support equities and bonds, while a hotter surprise could lift Treasury yields and the dollar and pressure risk assets.
After the inflation release, attention turns to Fed Chair Kevin Warsh’s semiannual Monetary Policy testimony on Capitol Hill. Warsh is scheduled to testify before the House Financial Services Committee on Tuesday at 10:00 AM ET and appear before the Senate Banking Committee on Wednesday, following a prepared report released Friday that described an economy slowing at the household level but supported by AI-driven investment, improving productivity, and a resilient labor market.