US Inflation Report Set To Test Case For September Fed Hike

August’s consumer price report will provide the final major inflation reading before next week’s Federal Reserve interest rate decision, potentially tipping the balance between another hold and a September hike.

Data from the Bureau of Labor Statistics is expected to show headline consumer prices rose 0.4% month on month in August, up from 0.1% in July. Annual inflation is forecast to remain at 3.4%.

Core CPI, which excludes food and energy, is expected to hold at 0.2% month on month, with the annual rate easing to 2.4% from 2.5% in July.

The Middle East conflict is again pushing oil prices higher, raising the prospect that headline inflation will remain elevated for longer. Both Brent and WTI crude are trading above USD 100 a barrel. Economists argue, however, that higher energy prices alone may not be enough to persuade the Fed to raise rates. (LS – Continue Reading)

Prices for Japan’s corporate goods rose at a faster pace than expected in August, supporting the case for the Bank of Japan to keep raising interest rates to stem upside inflation risks.

The measure of input prices for Japanese firms rose 7.6% in August from a year earlier, the BoJ reported Friday. The result beat the 7.4% median forecast of economists even as gains slowed slightly from the revised 7.7% in July, which was the highest since February 2023. On a monthly basis, prices fell 0.2% after an upward revision to 0.4% in the previous month’s result. (BBG – Continue Reading)