ME News reports that, on August 9 (UTC+8), economists surveyed by Reuters expect the U.S. July overall CPI year-over-year to decline from 3.5% in June to 3.4%; the core CPI year-over-year is forecast to fall from 2.6% last month to 2.5%. Citigroup economists believe that, as expected, if inflation readings soften for a second consecutive month, it would indicate that the cooling of inflation pressures extends beyond just one month, effectively eliminating the possibility of a September rate hike. However, economists also anticipate a slight rise in July core services inflation, with prices rising 0.3% month-over-month. This metric had remained flat from May to June. Bank of America analysts suggest that a rebound in the core services indicator could keep a September rate hike on the table. Analyst Kate Duguid stated that if this latter view prevails and inflation data comes in below expectations, the Fed’s rate hike could be delayed until December or later. (Jin10) (Source: BlockBeats)
July CPI Expected to Decline; Citibank and Bank of America Diverge on September Rate Hike Outlook
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Summary
July CPI is expected to decline to 3.4% year-over-year, with core CPI at 2.5%, according to on-chain data and Reuters surveys. Citibank views two consecutive softer readings as a sign that inflation is cooling, making a September rate hike unlikely. However, Bank of America notes that core services inflation is projected to rise 0.3% in July, keeping the possibility of a hike open. Analysts suggest a delay until December if data underperforms. Altcoins to watch may react to shifts in Fed policy.
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