Forex
Home›Forex›Major Pairs›US CPI on deck as oil surge and World Cup effects shap…
US CPI on deck as oil surge and World Cup effects shape inflation focus
June CPI is expected to cool, with headline inflation seen at 3.8% and gasoline-related deflation, while retail activity tied to World Cup host cities is cited as a potential lift for some CPI categories.
Forexlive said the next trading session will center on the release of US CPI for June, with attention heightened by a resurgence in the US-Iran conflict that has pushed oil prices higher.
The outlet noted that WTI is back near the $80 level and Brent around $85 earlier, raising the stakes for how the CPI print could shift expectations for the Fed outlook.
Forexlive expects headline annual inflation to ease to 3.8% in June from 4.2% previously, supported by estimated deflation in energy prices of more than 5% month-on-month, particularly after a strong March to May run. Core inflation is expected to remain more elevated, with core annual inflation forecast at 2.8%, down slightly from 2.9% in May.
The report also flags potential category distortions from the World Cup, which runs through much of June into July. Food and lodging are cited as areas that could move more than usual, and Bank of America data compiled from credit and debit cards across 11 US host cities shows brick-and-mortar spending at restaurants and bars up 5.3% year-on-year in the three weeks ending June 27, versus 3.8% in the rest of the US.
Forexlive added that markets are currently pricing roughly 43% odds of a rate hike in July, with a full 25 basis point hike already priced for September, making the CPI reaction the key driver for broader market moves later.
Latest closeWTI crude $78.04 ▲9.3%|Brent $83.15 ▲9.4%