With the latest FOMC meeting minutes highlighting a dovish split among Fed policymakers, will the upcoming U.S. CPI release settle the score when it comes to their inflation outlook?

Expectations are for a slightly stronger pace of price pressures in June, but markets could still chalk this up to temporary tariffs’ impact.

Here’s what you need to know when trading the U.S. CPI release.

Event in Focus:

U.S. headline and core CPI readings for June 2025: The Consumer Price Index (CPI) is a monthly measure of the change in prices paid by consumers for goods and services, an important metric that central bankers consider when deciding on monetary policy and interest rates.

When Will it Be Released:

July 15 (Tuesday), 12:30 pm GMT

Use our Forex Market Hours tool to convert GMT to your local time zone.

Expectations:

U.S. headline consumer price index m/m: +0.2% expected, +0.1 previous

U.S. core consumer price index m/m: +0.2% expected, +0.1% previous

U.S. headline consumer price index y/y: +2.5% expected, +2.4% previous

Forecasts as of July 14, 2025 at 2:59 am GMT

Previous Releases and Risk Environment Influence on the U.S. Dollar

June 11, 2025

Event results / Price Action:

The May U.S. CPI release reflected cooler than expected inflationary pressures, as the headline CPI ticked higher from 2.3% to 2.4% on a year-on-year basis but fell short of the 2.5% estimate. The core version of the report chalked up a meager 0.1% uptick month-on-month versus the projected 0.3% gain.

The U.S. dollar and Treasury yields tumbled as a result, with traders repricing more dovish Fed expectations from the downbeat inflation print. This was followed by weaker than expected PPI data the next day, which extended the dollar’s selloff across the board.

Risk environment and intermarket behaviors:

Traders had their eyes on US-China talks happening in London, as many held out hope that more concrete developments could be announced soon. A bit of risk-taking was seen after Trump had given negotiators wiggle room on tech export controls, weighing on USD against commodity currencies.

Renewed tariffs uncertainty later in the week contributed to more USD weakness after the CPI release, as Trump threatened even higher trade levies within two weeks. Resurfacing geopolitical tensions led to a pop higher for USD on Friday but not enough to pull it back in the black.

May 13, 2025

Event results / Price Action:

The April U.S. inflation report reflected cooler than expected price pressures, as the headline annual CPI came in at 2.3% versus the 2.5% expected and sparked rate cut speculations. Still, core inflation came in line with expectations of a 2.8% year-on-year gain.

The dollar sold off in reaction to the weaker CPI print, sustaining its losses until the end of the session before consolidating the next day then recovering when FOMC members signaled caution on future easing.

Risk environment and intermarket behaviors:

Tariffs talks were still front and center for the most part of the week, which kicked off with a dollar rally on a 90-day truce between the U.S. and China. Easing Fed rate cut expectations also provided the U.S. currency support, even though risk-on flows came in play while the global trade outlook improved.

April 10, 2025

Event results / Price Action:

U.S. inflation broadly missed market estimates in April. Specifically, headline inflation unexpectedly fell 0.1% while core CPI eased from 0.4% m/m to 0.2% m/m.

The U.S. dollar, already hit by slower deflation in China and profit-taking in early European trading, dropped at the weak CPI release. USD’s selloff would later accelerate when the White House clarified that tariffs on China’s goods are at 145% (from 125%).

Risk environment and intermarket behaviors:

Global trade policy updates dominated the week’s news flow and arguably had the biggest weight of influence on currency price action.

A trifecta of weak U.S. CPI, a bond market selloff, and confirmation that China’s tariff rate would rise to 145% sparked a rush out of the dollar. By week’s end, the U.S. dollar took the biggest brunt of tariff fears, while took the Swiss franc took top spot among the majors.

March 12, 2025

Event results / Price Action:

The February CPI report turned out weaker than expected, the headline reading reflected cooling inflationary pressures from 3.0% to 2.8% year-on-year versus the 2.9% forecast. Core inflation fell from 3.3% year-on-year to 3.1% as expected, highlighting the possibility of a more dovish Fed.

The dollar had a mostly bearish reaction to the numbers, but the currency managed to pull up in the next trading session before the PPI report triggered another wave lower.

Risk environment and intermarket behaviors:

Investors were still mainly focused on trade-related headlines throughout the week, as Trump’s announcement and subsequent withdrawal of additional tariffs on Canada created significant volatility.

Risk-off flows were evident and somewhat supportive of the safe-haven dollar, especially after Trump threatened to impose 200% tariffs on European alcoholic beverages, although risk rallies also kicked in on positive Russia-Ukraine developments.

Relevant Data Since Last Event/Data Release:

• U.S. ISM Manufacturing PMI for June 2025: 49.0 (49.2 forecast; 48.5 previous); Prices component: 69.7 (69.7 forecast; 69.4 previous)
• U.S. Average Hourly Earnings for June 2025: 0.2% m/m (0.2% m/m forecast; 0.4% m/m previous); 3.7% y/y (3.9% y/y forecast; 3.9% y/y previous)
• U.S. ISM Services PMI for June 2025: 50.8 (49.7 forecast; 49.9 previous); Prices component: 67.5 (69.4 forecast; 68.7 previous)
• U.S. S&P Global Services PMI Final for June 2025: 52.9 (53.1 forecast; 53.7 previous); prices up due to higher financing, wages, and fuel costs
• U.S. S&P Global Manufacturing PMI Final for June 2025: 52.0 (52.0 forecast; 52.0 previous); input prices rose to three-year high due to tariffs
• U.S. Consumer Inflation Expectations for June 2025: 3.0% (3.2% forecast; 3.2% previous)
• WTI crude oil jumped from the $60 per barrel area to highs near $77 per barrel due to Middle East tensions in the first half of June

Price action probabilities:

Risk sentiment probabilities:

Trade headlines were mostly responsible for pushing overall market sentiment around in the previous trading week, as Trump imposed 25% tariffs on South Korea and Japan, followed by 50% on Brazil and 35% on Canada.

Although Trump also extended the deadline for negotiations to August 1, markets appeared to be dealing with “tariffs fatigue” and struggled to find clear direction before the dovish split in the FOMC minutes weighed on USD. Still, safe-haven flows prevailed as the spotlight turned back to tariffs announcements later in the week, suggesting that trade-related tensions in the next few days could still stoke risk-off vibes.

U.S. Dollar scenarios:

Forecasts are pointing to an uptick in price pressures for June, with business PMI surveys reflecting sharp gains in input costs due to the inflationary impact of higher tariffs. Even though the impact on wages and consumer inflation expectations has been limited, there could be a case for an upside CPI surprise while energy costs also surged due to elevated geopolitical tensions during the month.

With that, look out for hotter-than-expected headline and core inflation data that could lead to some unwinding of short USD positions after last week’s FOMC minutes release, as traders could focus on dampened odds of an interest rate cut in the next Fed decision.

In this scenario, watch out for further downside on GBP/USD while U.K. fiscal uncertainty looms or a potential USD/CAD rally in case crude oil continues to slump on supply chain jitters from tariffs.

On the other hand, an unlikely CPI miss could remind traders that FOMC policymakers are divided on the timing and scale of future rate cuts, possibly tipping the scales in favor of a more dovish bias.

In this case, look out for a continuation of the downtrend on USD/CHF or a range resistance bounce on USD/JPY if risk-off flows or anti-USD sentiment pick up. Risk-taking, on the other hand, could favor gains for AUD/USD or NZD/USD, especially if the global trade outlook improves.

Whichever scenario plays out, keep in mind that the U.S. dollar tends to take its initial cues from the headline CPI, but eventually follow cues from core CPI readings for its sustained moves.

Markets also tend to “buy the rumor, sell the news,” meaning even strong CPI prints don’t always boost the USD if expectations were already priced in. Waiting for volatility to settle before entering a trade helps avoid whipsaw moves and provides better opportunities with lower risk. Letting the market establish a clear direction can lead to more strategic trades.

Whichever bias you’re trading, make sure you adjust your positions and risk management plans to account for other top-tier market movers!

Disclaimer: The Event Guide is provided for educational and informational purposes only. It is not intended as investment or trading advice, nor should it be interpreted as a recommendation to take any position in the market. The goal of this content is to help readers become aware of recent economic developments that may influence market behavior. These insights are designed to support the development of each trader’s own scenarios and directional biases, which may require further analysis and due diligence before acting upon.

All trading decisions—including entry, exit, risk management, and position sizing—are entirely the responsibility of the individual trader. The scenarios and interpretations discussed may not be suitable for all trading strategies, risk profiles, or portfolio objectives. Past market behavior does not guarantee future results. Please trade responsibly and at your own risk.