KlipC Report: Tonight at 20:30, the most critical data for September—the US August CPI and core CPI figures—will be released. This report will be a key determinant in whether the Federal Reserve maintains higher interest rates for an extended period.

Andi D, a partner at KlipC, stated: "As the last major data point before the Fed's September meeting, inflation performance is the central focus for the Fed's decision-making. This is a challenging issue for both the Fed and the market. Multiple indicators show the US labor market remains tight, and wage growth is still unstable, so some optimism about inflation steadily declining toward 2% may be premature."

Moreover, most market participants expect CPI to rebound, forecasting a 0.4 percentage point increase to 3.6%, while core CPI is projected to drop from 4.7% to 4.3%.

Economists also widely predict that the US headline CPI year-on-year for August will rise further to 3.6% from July's 3.2%, with a month-on-month increase of 0.6%, significantly higher than July's 0.2% monthly rise.

A Wall Street analyst told KlipC: "For now, positive news on core data should offset the strong headline inflation. However, the risk remains that the longer headline inflation stays elevated, the greater the chance of second-round effects emerging."

Goldman Sachs analysts added that if this week’s inflation data falls below expectations, it could signal to traders that the Fed has reached peak rates and won’t hike further. But if inflation exceeds forecasts, additional rate increases later this year could lead to more indecision and volatility in markets. Currently, markets price in a 93% chance of the Fed holding rates steady at its September 20 policy meeting, but bets on another pause in November are lower at just 57%.