ING: Even if inflation exceeds expectations, the US dollar is unlikely to sustain its rally

According to a report by Jinse Finance, ING analyst Francesco Pesole stated that the U.S. inflation data to be released later today may exceed expectations, but any gains in the U.S. dollar are likely to be short-lived. He noted that labor market data is more influential than inflation data, as tariff-driven price shocks are considered temporary and the latest non-farm payroll report has been significantly revised downward. He added that if inflation comes in higher than expected but is accompanied by further deterioration in the labor market, it could still align with the Federal Reserve's expectations for a rate cut in September. This suggests that higher-than-expected inflation is unlikely to lead to a sustained rise in the dollar. ING forecasts that the core inflation rate in July will rise by 0.4% month-on-month, higher than the 0.3% generally expected by economists. (Jin10)