Markets Hold Steady Ahead of US Inflation Data

Financial markets have steadied ahead of the release of US inflation data, which is set to guide the Federal Reserve's decision on interest rates. The dollar has remained largely unchanged against its main rivals, while oil prices dipped due to developments in the Middle East.

European and Asian stock markets have been relatively calm, with investors weighing corporate earnings against concerns about technology firms' spending on artificial intelligence. However, ongoing tensions in the Middle East continue to affect oil prices and inflation expectations.

The US consumer price index (CPI) figures are due out at 8:30 am New York time, an hour before Wall Street opens for trading. The median forecast is 3.4 percent, with about 30 percent of economists expecting a lower inflation print than that.

Monetary policymakers are considering a lift in borrowing costs, as US inflation has held above the Fed's two-percent target for more than five years, compounded by the Middle East war since February. Three board members dissented from the final decision to hold rates steady at the July meeting, and investors are betting on a rate hike before the end of the year.