June US CPI Misses Expectations, Easing Fed Rate Hike Pressure
US headline CPI fell 0.4% month-over-month in June, with the annual rate dropping to 3.5% from 4.2%, reducing expectations for further Federal Reserve rate hikes.
The June US Consumer Price Index (CPI) surprised to the downside, with the headline figure falling 0.4% from the previous month. The annual inflation rate decelerated to 3.5%, down from 4.2% in May, marking a sharper-than-expected cooling.
This softer inflation reading has dampened expectations for additional rate hikes by the Federal Reserve. Markets now see a reduced probability of further tightening, which could weigh on the US dollar in the near term.
Traders will be watching for any shift in Fed rhetoric following the data, as the central bank balances inflation control with economic growth concerns.
Source: FXStreet Forex News