US CPI Data Release Impacts Global Markets

Global markets are on edge as they anticipate the U.S. consumer price index (CPI) data release, which is expected to influence future monetary policy and Federal Reserve rate decisions. Analysts predict a month-on-month increase of 0.3% and a year-on-year rise of 2.9% for December's CPI, critical for shaping expectations around potential rate cuts in 2025. Cautious trading was observed across global stocks, with Wall Street futures showing modest gains, driven by positive earnings reports from firms like BlackRock and expectations surrounding major U.S. banks. Emerging market assets remained stable but faced pressure from a strong U.S. jobs report that dampened prospects for rate cuts. Michelle Girard from NatWest Markets emphasized that today's CPI data could significantly shift the Fed's narrative regarding interest rates. Investors are also keeping an eye on earnings from key financial institutions, which could further impact market sentiment.