Categories: Market Overview

Falling US inflation sparks more risk appetite

The US consumer price index fell 0.1% instead of the expected 0.1% increase, slowing annual inflation to 3.0% from 3.3% last month and below the expected 3.1%. The price index excluding food and energy slowed to 3.3%, also weaker than expected.

The faster inflation slowdown prompted a reassessment of policy rate forecasts. According to the FedWatch tool, traders now see a 45% chance of three or more rate cuts by the end of the year, up from 27% a day ago and 14.5% a month ago.

This is negative news for the dollar and positive for global demand for risk assets, including equities and gold. US indices continue to hit all-time highs on a daily basis, and the sentiment index has returned to “greed” territory. The price of gold passed $2410 per ounce. The price was above this level only between the 17th and 22nd and for a few minutes on the 12th and 19th.

The FxPro Analyst Team

The FxPro Analyst Team

Our team consists of financial market experts. Our dedicated professionals prepare reviews on the foreign exchange market situation, Crude Oil, Gold and Stock Indices. All the analysts are regularly published in the world leading economic media.

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