investingLive Americas FX news wrap 11 Aug:Modest changes in the markets ahead of CPI

[Forex News]

• US stocks close lower. Nasdaq trades to a new intraday high before rotating lower
• Crude oil settles at $63.96
• Trump extends China tariff deadlines 90 days
• Add FOMCs Bowman, Jefferson and Dallas Fed Pres. Logan to list of Fed Chair
• Trump: Gold will not be tariffed
• Major European indices closed the day with mixed results
• Trump: We'll see what happens with the China deadline. Putin meeting is a feel out meeting
• After sending in National Guard to LA, Trump now sends them to Washington DC
• Trump tariff revenues reached $29.6B in July. Has it peaked?
• NVDA stock analysis today with orderFlow Intel @ investingLive
• Technical Analysis: What technical levels are driving the EURUSD, USDJPY & GBPUSD
• investingLive European markets wrap: Dollar steady, gold slips; markets wait on US CPI

The US dollar is settling higher versus the major currency pairs. The biggest gain was versus the NZD (0.34%). The greenback rose by 0.18% versus the AUD ahead of its interest rate decision in the new trading day. The Reserve Bank of Australia is expected to cut rates by 25 basis points in reaction to lower inflation (2.1% year) and some weaker jobs data.

Tomorrow the US CPI will be released at 8:30 AM ET with the month-to-month expected to rise by 0.2% and the core up 0.3%. For the YoY, the headline is expected at 2.8% vs 2.7% last month. The Core is expected to tick up to 3.0% from 2.9% last month.

Focus will be on the goods inflation to see if the impact from tariffs is accelerating the inflationary pressures (or not).

Last month core goods narrowly pushed prices up by 0.2% m/m in June—a repeat of May’s increase

Core services inflation picked up to 0.3% m/m in June, up from around 0.2% the previous month.

• Within that, shelter costs rose by 0.2%, marking the smallest monthly gain since August 2021.
  

The key takeaway from last month was goods price growth remains modest, suggesting limited inflation pressure from trade-sensitive sectors so far.

Services inflation, led by shelter, continues to provide underlying pressure in core CPI—highlighting its stickier contribution to overall inflation. However, the decline in shelter is a postive. Shelter accounts for 34% of the overall CPI weight - by far the greatest influence in the figure.

If goods inflation can remains elatively tame, it will give the dovish Fed officials more leeway to call for rate cut rates with the understanding that the tariff effect continues to remain subdued and the focus should shift to the risk from weaker employment (after the poor US jobs report at the beginning of the month).

The calendar was void of any data today. From Washington, Trump announced that China would get another reprieve from increased tariffs for 90 days.

Trump spoke of progress being made on peace negotitions between Ukraine and Russia as he prepares to meet with Russia's Putin later in the week. Trump described the meeting as a "feel out" meeting that he hopes to lead to the Putin and Zelenskiy getting together and calling a truce to the war

US stocks closed modestly lower, giving up earlier gains.

• Dow -0.45%
• S&P -0.25%
• Nasdaq -0.50%

US yields are ending the session little changed with the 2-year up 0.08 basis points and the 20 year down -0.02%.

This article was written by Greg Michalowski at investinglive.com.

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