The US dollar firmed after US CPI matched expectations, as market positioning had leaned towards a hotter release. Headline CPI rose 0.1% month on month and core CPI increased 0.2%, yet the greenback ended the session stronger as rate expectations adjusted only modestly and some long exposure was rebuilt. Core inflation was described as running at a 1.6% three-month annualised pace, while implied US policy pricing remained restrictive and kept FX volatility contained ahead of the Jackson Hole Symposium.<\/p>\n\n
Fed expectations stayed hawkish despite recent data shaving 5bp off September FOMC pricing; 9bp of tightening is still implied for that meeting, and the curve continues to price a full 25bp hike for December. Attention now turns to next week\u2019s FOMC minutes and the day\u2019s PPI release, with further second-tier data also in focus for near-term USD direction.<\/p>\n\n
Separately, developments in the Gulf, including the Strait of Hormuz negotiations, were flagged as a potential driver via broader risk sentiment.<\/p>\n\n\n\n