As traders await the upcoming US Consumer Price Index (CPI) report, market participants are treading cautiously, with expectations that the data could significantly influence Federal Reserve policy. The CPI is anticipated to be a pivotal indicator, potentially affecting the Fed's rate decisions in 2025. "A strong inflation number adds to this idea of no cuts in 2025, and potentially even a rate hike, while a weak inflation data point may help to calm the market’s Fed fears," said Chris Brigati at SWBC. The report is expected to cause ripples through global markets, with US Treasury yields already spiking due to robust economic data.
In the commodities sector, oil prices have recently slipped from a five-month high following a tentative cease-fire agreement between Hamas and Israel, which has eased concerns over potential disruptions to Russian and Iranian oil supplies. This geopolitical development has contributed to a cooling of the recent rally in oil prices, providing some stability in the market.
As of 18:11 on January 14, the price of crude oil (CL1) stands at $77.95, slightly up from its last close of $77.50. The market remains attentive to geopolitical developments and upcoming economic data, which could further influence oil prices and broader market sentiment.