Yesterday's slightly higher-than-expected core US CPI for August saw 7bp priced out of the expected 2024 Fed easing cycle. Yet 100bp is still priced in. We doubt those expectations change meaningfully today. In focus will be the August PPI readings and the weekly initial claims data, ING’s FX strategist Chris Turner notes.

101.90/102.00 resistance should hold in DXY

“This year, PPI readings have taken on greater focus as the market analyses key components such as portfolio management fees, healthcare costs and airfares which read through to the Fed's preferred measure of inflation, the core PCE deflator. However, now that the Fed has declared ‘the time has come’ to start cutting rates, financial markets will be far less worried by the inflation data prints and have shifted their focus squarely on activity data – particularly jobs data. Here the holiday-shortened week probably means that initial claims data today will remain low near 225,000. In short, not a lot new from the US calendar.”