🇺🇸The US Consumer Price Index (CPI) will be announced tomorrow at 8:30 AM Eastern Time.

Market expectations are at 3.1%, while last month's CPI was 2.9%.

Here are the different scenarios:

1 ⃣CPI > 3.1%

This will be bearish for the market.

This is because it will mark the highest CPI value since June 2024.

2 ⃣CPI = 3.1%

This will meet expectations but still be somewhat pessimistic.

This is because it will show a 0.2% month-on-month CPI increase, or an annualized CPI growth of 2.4%.

The Fed's target inflation rate is 2%, which means Powell may turn slightly hawkish.

3 ⃣CPI < 3.1%

This is a perfect scenario for risk assets.

Interest rate cuts will materialize, with CPI rising only 0.1% month-on-month or 1.2% annualized.

This will also increase the likelihood of further rate cuts and lead to liquidity flowing into risk assets.