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Economists expect the Consumer Price Index (CPI) to have edged lower in August in tomorrow morning’s report.

Expectations are that the Core CPI, which excludes volatile food and energy prices, fell in August to a 4.2% year over year rate. The core CPI hit 4.5% in June and then dropped to 4.3% in July.

A drop, even a small drop, would support the Federal Reserve’s argument that the current rate of inflation, well above the central bank’s 2% target, will be transitory and will fall as the economy works through pandemic-related supply chain problems. A rise in the CPI, even though the Fed watches the PCE (personal consumption expenditures) index rather than the CPI, would lead to a rise in market speculation that the Fed might move to cut its bond purchases at its September 22 meeting. Right now the markets think there’s almost no chance of a Fed change to its $120 billion a month in bond purchases at the meeting.

It’s that consensus that gives tomorrow’s report leverage to move the market.