The latest US CPI report was published on Wednesday:
Forexlive Americas FX news wrap: CPI continues to cool
JP Morgan in response:
the CPI is a ‘green light’ for the Federal Open Market Committee (FOMC) to cut in September (the meeting is on Sep 18 and 19)the Fed may cut 50bp, or 25bp
JPM on what will prompt a 50bp cut (50bp is the JPM forecast):
key factor will be the extent of the rebound in the August payroll reportIf job gains fall within the 160-200k range, it could alleviate much of the concern sparked by the July labor report However, if the gains are closer to the low-100s, the risk may shift toward growth, potentially leading to a larger cut
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The August US jobs report JPM refer to is due on September 6.
I guess if the number is low enough there could be a 50bp cut. Sheesh. Wouldn’t 50bp just create a bit of panic?
This article was written by Eamonn Sheridan at www.forexlive.com.
