US Dollar's Rollercoaster Ride: CPI Report and Fed Decision Shake the Market

The US dollar initially fell in response to the CPI report, but quickly reversed and gained strength. The market had priced in potential Fed cuts, but the reaction to the report suggests a possible buying of the US dollar ahead of the Federal Open Market Committee (FOMC) meeting. The report itself revealed some concerning factors, including a small miss in m/m CPI, higher real weekly earnings, and increased services less rent of shelter. The market's reaction may be influenced by pre-Fed positioning, as well as the upcoming 30-year Treasury auction.