US Dollar Maintains Gains as July CPI Report Shows Elevated Inflation

Talking Points

– Headline July US CPI comes in at +2.9% y/y as expected, but the core CPI reading was above expectations at +2.4%, the fastest reading since September 2008.

– The beat on the inflation report comes as rates markets were already pricing in a 92% chance of a 25-bps rate hike next month by the Federal Reserve.

– The US Dollar was able to maintain its breakout from its two-month consolidation, with the DXY Index holding near its daily highs after the inflation report.


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