Global Hotspots Spark Inflation Fears Ahead of US CPI Data
Global hotspots are putting pressure on central banks to contain energy-driven inflation as Brent crude prices rose for a sixth straight session. The price of Brent oil is poised for its longest streak since late April, highlighting mounting concerns about inflation.
The Reserve Bank of Australia delivered a hawkish hold on policy rates on Tuesday, while traders are increasingly betting the Bank of Japan could tighten again as soon as next month. This comes amid rising tensions in various regions, including the war in Iran and North Korea's recent ballistic missile launch into the ocean.
Today's consumer price index data in the U.S. will not capture the most recent rise in energy costs but is still likely to shape expectations for the Federal Reserve's September meeting. The data follows a bad miss on U.S. payrolls last Friday, highlighting the narrow path for Fed officials in balancing support for the economy and keeping inflation in check.