Latest consumer inflation data cements Fed rate cut odds at 25 basis points

Interest Rate Expectations: Following the release of slightly higher-than-expected core consumer inflation data, U.S. market participants are now anticipating a 25 basis point interest rate cut by the Federal Reserve next week, with odds rising to 85% for this outcome.

Market Reaction and Economic Outlook: Wall Street reacted negatively to the CPI data, indicating concerns over rising inflation potentially leading to weaker real incomes and increasing recession risks as the Fed may take a cautious approach in adjusting monetary policy.