US August CPI +0.6% m/m versus +0.6% m/m expected

<ul><li>Prior m/m +0.2%</li><li>CPI m/m +0.6% versus +0.6% expected </li><li>CPI y/y 3.7% versus 3.6% expected</li><li>Prior y/y 3.2%</li></ul><p>Core measures:</p><ul><li>Core CPI m/m +0.3% versus +0.2% expected. Last month 0.2%</li><li>Unrounded core at +0.278%</li><li>Core CPI y/y 4.3% versus 4.3% expected. Last month was 4.7%</li><li>Shelter +0.3% versus +0.4% last month. Year on year 7.3% versus 7.7% last month</li><li>Services less rent and shelter +0.5% m/m vs +0.2% prior</li><li>Real weekly earnings -0.1% vs 0.0% prior</li></ul><p>The market was pricing in a 9% chance of a hike next week ahead of the data but that rose to 53% for December. Afterwards, the September hike odds are down to 5% but December held steady.</p><p>The numbers are modestly hotter than expected with the headline boosted by a 10.6% increase in gasoline prices m/m while the core was boosted by a 4.9% rise in airline fares. One drag was used vehicles, which fell 1.2% m/m.</p><p>In the FX market, the US dollar swung higher and lower but is now largely unchanged after the release.</p>

This article was written by Adam Button at www.forexlive.com.