分析师：US CPI Month-over-Month May Record Negative Growth, Easing Market Fears of Imminent Fed Rate Hike

Odaily Planet Daily News Analyst Matthew Weller stated that whether inflation has peaked is the market's biggest concern ahead of the June CPI report. For the first time in three months, the Strait of Hormuz partially reopened in the second half of June, leading to a sharp decline in energy prices, while the lagged effects of Trump's now-expired "Liberation Day" tariffs may have been largely priced in by the market. Against this backdrop, traders and economists expect the overall month-over-month inflation rate to record its first negative growth in over a year, which would ease market fears of an imminent Fed rate hike.

The federal funds futures market currently prices in a 35% probability of a rate hike at this month's Fed meeting, following a relatively hawkish tone at last month's meeting under new Fed Chair John Williams. Although a hawkish outcome may be overly optimistic, a surprising CPI report, combined with Chair Williams' testimony before both houses of Congress on Tuesday and Wednesday, could still trigger abnormal volatility in major markets amid uncertainty. (Jinshi)