Overview

• CME FedWatch shows roughly a 95% chance of a 25-basis-point cut on Sept. 16–17, with traders also leaning toward additional reductions in October and December.
• U.S. CPI accelerated to 2.9% year on year in August and 0.4% month on month, the highest since January, with analysts noting tariff effects as a key upside risk.
• Labor indicators weakened, with unemployment rising to 4.3% and only about 22,000 nonfarm jobs created in August, underscoring the Fed’s growth-versus-inflation trade-off.
• Political pressure on the central bank is intensifying as Trump’s nominee Stephen Miran advanced in a Senate committee and a court blocked the attempted removal of Governor Lisa Cook.
• The ECB kept rates unchanged, and investors expect U.S. easing to weaken the dollar and spur short-term portfolio flows into emerging markets such as Argentina.