The US Dollar is holding firm after a four-day winning streak, trading flat against most major currencies following a hotter-than-expected CPI report that showed corporations are passing rising costs to consumers. Core goods prices rose 0.2 percent in June, but excluding cars, the increase was 0.55 percent—the biggest since late 2021—leading markets to scale back expectations for Federal Reserve rate cuts. However, softer-than-expected PPI data this morning showed a slight drop in producer costs, slightly offsetting that narrative. Looking ahead, retail sales and housing data due later this week will be key. Meanwhile, the British Pound is slightly higher after UK inflation exceeded forecasts, likely complicating the Bank of England’s rate path. The Japanese Yen is also marginally stronger, though still weak overall, with attention turning to this weekend’s election and potential volatility from thin Monday trading due to a public holiday.
