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What to watch

MARKET INSIGHT
  • The main scheduled event of the week will take place today with the release of US CPI. Consensus has headline CPI slowing to just 0.2% M/M from an unwind in energy prices, whilst core CPI is seen easing from 0.7% to 0.5% M/M but after three sizeable beats. Analysts see various driving forces for the moderation in core CPI but only a limited easing in shelter after once again surprisingly to the upside in June at multi-decade M/M highs. The market reaction to Friday’s payrolls beat shows the potential for large moves, with significant two-sided risk to this release. The full MNI CPI preview is available here.
  • Note that in an MNI Exclusive Interview from our policy team with the Fed's Bullard yesterday saw him say that the Fed will be prepared to hold interest rates "higher for longer" should inflation continue to surprise to the upside, and market pricing will need to adjust accordingly. A podcast of the interview is available here with the text highlights here.
  • BOE Chief Economist Pill will be holding an online Q&A on the BOE's reaction to the rising cost of living at 17:00BST.
  • Fed's Evans and Kashkari are due to speak at 16:00BST and 19:00BST respectively to disvuss the economy and inflation. These will both be worth watching after today's CPI print.

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