Tonight at 20:30, the showdown on CPI! Comparing with the major non-farm payroll data from the 1st of this month!
Is there a possibility tonight that the current expectations are all leaning bearish, and the published value either meets the expected value or remains the same as the previous value, or is slightly lower than the previous value, paving the way for a rate cut in September?
The answer will be revealed tonight at 20:30!
Currently, the market generally predicts that the Federal Reserve will cut rates twice this year, approximately 50-75 basis points!
The probability has reached 80%, and this prediction has driven the Nasdaq and others to continue rising and setting new highs this month!
If there’s any significant volatility in tonight's data, it will likely lead to a large shakeout for both bulls and bears!
From various market news, it seems that the Fed's rate cut is basically set to begin, but the issue is whether it will start this year or next year and how much the rate will be cut!
All of this needs data accumulation; currently, CPI data has rebounded for three consecutive months. Only if this month’s data stabilizes or even decreases can it pave the way for a rate cut in September!
Therefore, I predict that tonight's expected value will be bearish, already digested in advance, and the published value will meet the expected value or equal the previous value, remaining lukewarm, pushing the pressure onto the core PCE data at the end of the month!
The best scenario tonight would be to suppress first and then rise; if it significantly exceeds the expected value, it would be very bearish, and a deep market dip would also mean a violent washout, which could be good for the future market, as it can't always be profitable. Taking a break sometimes is also a better way to recharge!