U.S. Headline CPI Falls 0.4% in June, Fed Rate-Cut Odds Plummet to 15.5% on July 15

CME-0.62%
According to the U.S. Department of Labor, headline CPI fell 0.4% month-over-month in June, significantly below market expectations of 0.1%, on July 15. Core CPI also came in flat, missing the forecast of a 0.2% increase. Following the softer-than-expected data, the probability of a Federal Reserve rate cut this month dropped sharply to 15.5% from 41.7% a day earlier, according to CME FedWatch futures. In South Korea, government bond futures rose in response: the 3-year contract climbed 15 basis points to 102.87, while the 10-year contract gained 25 basis points to 105.30. U.S. Treasury yields also declined, with the 2-year and 10-year rates falling 8.8 basis points and 3.3 basis points respectively.
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