1. ING: We expect overall CPI and core CPI to rise by 0.4% and 0.2% month-on-month, respectively. This should be sufficient to prompt the Fed to raise interest rates by 25 basis points on September 16th.
2. Bloomberg: We expect overall CPI to rise by 0.39% month-on-month in August, and core CPI by 0.24%. We currently slightly favor keeping interest rates unchanged in September, but expect a very close decision.
3. Mitsubishi UFJ: Recent oil price increases have increased the risk of persistently high inflation. Price data and oil price trends could lead to up to five committee members opposing keeping interest rates unchanged, making the September decision a potentially "thrilling one."
4. BlackRock: Whether inflation is rising or not falling at a sufficiently rapid pace will determine whether the Fed raises interest rates at its September meeting. If August CPI continues to show improving inflation, the Fed will keep interest rates unchanged.
5. IFM Investors: If the August CPI does not show a convincing decline, the Fed may need to take action to maintain Warsh's policy credibility; therefore, the CPI must be sufficiently moderate to provide a reasonable basis for holding rates steady in September.
6. Wells Fargo: The Fed expects the overall CPI to rise 0.40% month-over-month in August, mainly driven by rising oil and gasoline prices; if core inflation remains moderate, it will support the Fed keeping interest rates unchanged, the key being whether the energy price increases transmit to a wider range of sectors.
7. TD Securities: The Fed expects the core CPI to rise 0.19% month-over-month in August (2.3% year-over-year), while the overall CPI may be stronger, reaching 0.37% month-over-month (3.4% year-over-year); the Fed is expected to keep interest rates unchanged in September. If the Fed takes action again this year, it is more likely to raise rates than cut them.
8. DBS Group: The Fed expects the overall CPI to rise 0.4% month-over-month and the core CPI to rise 0.3%, which may further increase market expectations for interest rate hikes. Short-term US Treasury yields have largely reflected hawkish expectations. Strong CPI is more likely to prompt the market to price in a rate hike in advance, rather than increasing the number of rate hikes.
9. Commerzbank: If the data meets expectations, the market expects to maintain a slightly below 60% probability of a rate hike; if the CPI exceeds expectations, rate hike expectations will rise, and vice versa. If the CPI causes market expectations to be excessively biased to one side, and the final FOMC decision falls short of expectations, the market may experience sharp fluctuations.
10. Deutsche Bank: It expects August CPI to rise 0.38% month-on-month, and core CPI to rise 0.21%. Although the data may not be enough to support a rate hike, inflation "stickiness" still leans towards a rate hike; coupled with the resilience of the labor market, as long as subsequent data does not weaken significantly, a rate hike in September remains the most likely outcome.
11. JPMorgan Chase: It expects overall CPI to rise by approximately 0.38% month-on-month, and core CPI by approximately 0.21%. The real debate in the market is whether the core CPI will ultimately be rounded to 0.2% or 0.3%. 0.2% is sufficient to support the Fed holding rates steady in September, while 0.3% could prompt the Fed to begin raising rates.
12. Nomura Securities: Core CPI is expected to remain largely stable at 0.22% month-on-month. Three consecutive months of moderate core PCE data have led most FOMC members to believe that inflation is gradually returning to the 2% target. Therefore, even with short-term fluctuations in August's CPI, maintaining the current interest rate in September remains the baseline assessment and is insufficient to trigger a tightening policy.
13. Scotiabank: Believes the market has already priced in a high probability of a September rate hike. If the CPI unexpectedly overheats, rate hike expectations will further intensify. Warsh emphasizes market signals; if the market clearly shifts towards rate hike expectations, he will face significant pressure. Even if the data only weakens moderately, it may not be enough to reverse current rate hike expectations.
