The US Bureau of Labor Statistics is scheduled to release the August Consumer Price Index (CPI) data on Friday, with forecasts indicating a slight decline in core inflation. This data release is expected to play a key role in shaping market expectations for the Federal Reserve's upcoming policy decisions.
According to FX Street, MUFG’s Lee Hardman noted that stronger-than-expected US Producer Price Index (PPI) figures have bolstered the case for a Federal Reserve rate hike. Currently, about 18 basis points of tightening are priced in for the Federal Open Market Committee (FOMC) meeting next week.
For Japanese investors, closely monitoring US inflation trends remains crucial as shifts in Fed policy directly influence global risk sentiment and currency markets, including the yen and USD/JPY pair.