Mid-Week Wrap: 10 July 2024
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Market Mood
The upcoming US CPI release will shed light on the Fed's inflation battle, with a consensus expecting a 0.1% monthly increase after May's flat reading, lowering the annual rate to 3.1%, and the core rate holding steady at 0.2%. Any downside surprises could enhance risk sentiment, while Fed Chair Jerome Powell's Senate testimony will provide further insights. In China, inflation and factory gate prices will be closely monitored after May's annual CPI was just 0.3%, with the Caixin PMI indicating the fastest input price rise since June 2022, leading to the first output price increase this year. China's trade numbers, due over the weekend, are crucial against mixed PMI signals on goods export growth, although China’s exports have risen consistently over the past six months despite global declines. In the UK, May GDP data will be released, with prior PMI readings suggesting a slowdown in growth for April and May, following a 0.7% GDP increase in the three months to April.