European Markets Caution Awaiting US CPI
European stocks edged higher on Thursday ahead of the ECB policy decision and the US CPI release. At 07:05 GMT, Germany's DAX rose 0.1%, France's CAC 40 +0.3%, and the UK's FTSE 100 +0.3%. Gains were limited as investors chose to wait for these two key events.
The focus is on Frankfurt. The ECB is expected to hold interest rates, having previously cut its benchmark rate to 2% through June and paused as inflation returns to target and growth stabilizes. However, the central bank will keep the option of further easing open if needed.
Uncertainties add to the caution: 15% US tariffs on EU imports, low regional growth, and political turmoil in France. President Christine Lagarde is expected to offer no specific guidance, but she is also not closing the door on further cuts, given that inflation is projected to be below 2% next year.
In the US, consensus forecasts August CPI at 2.9% YoY (core 3.1% YoY). The market has already priced in a 25 bps rate cut by the Fed next week, while the likelihood of a 50 bps rate cut has increased following the benign PPI. This data has the potential to determine the direction of the rupiah as a global asset ahead of the Fed meeting. (ayu)
Source: Newsmaker.id
