Francesco Pesole, an analyst at the Netherlands International Group, said in a report that the US inflation data to be released later today may exceed expectations, but any gains in the US dollar are likely to be short-lived. He stated that labor market data is more influential than inflation data, as people believe that the price impact caused by tariffs is temporary, and the latest non-farm payrolls report has been significantly revised downwards. He said that if inflation exceeds expectations, but is accompanied by further deterioration in the labor market, it may still meet expectations of a rate cut by the Federal Reserve in September. This means that higher-than-expected inflation is unlikely to lead to a sustained increase in the US dollar. The Netherlands International Group expects the core inflation rate for July to rise by 0.4% on a month-on-month basis, higher than the general expectation of 0.3% among economists. (FX678)
