Market Brief, North America

Market optimism is rising ahead of a key US inflation report that is expected to show price pressures softening on a sequential basis in April. Our summary of updated estimates provided by the biggest global banks and investment firms suggests that the headline basket is seen rising 0.4 percent month over month, bringing the annual change down to 3.4 percent from 3.5 percent in March. The core measure is believed to have climbed 0.3 percent, falling to 3.6 percent from 3.8 percent in the prior month. Traders are positioning for an asymmetric market reaction. A strong print could be seen...

Foreign exchange markets are holding steady this morning as traders take cover ahead of a series of critical inflation reports that could determine the outlook for rate cuts from the Federal Reserve this year. The dollar is little changed against its major rivals, Treasury yields are moving sideways, and North American equity futures are pointing to incremental gains at the open. Today’s Survey of Consumer Expectations from the New York Fed is likely to echo Friday’s equivalent from the University of Michigan, with inflation expectations rising toward a six-month high. Household views on inflation tend to follow changes in gas...