Morning Brew August 12 2026

Good morning.

Today is CPI day, and markets are treating it as the main event of the week. Germany reports at 08:00, with inflation expected at 2.8%, Italy follows at 10:00 with the same expected headline rate, and the U.S. CPI print lands at 14:30. Consensus is for headline inflation around 3.4% and core inflation around 2.5%. After the recent softer labour-market data, this is the number that will decide whether the market can keep leaning toward a more dovish Fed narrative or has to price in renewed pressure on the FOMC.

What is striking is how resilient markets have been despite the bad news from the Middle East. Oil is up around 12% over the past week, shipping risks remain elevated, and the U.S. and Yemen’s Iran-aligned Houthis have both reported fresh attacks on shipping. Yet equities have largely shrugged this off, helped by hopes that lower labour-market momentum gives the Fed more room to wait.

Rates and FX are calm, but not relaxed. U.S. 10-year yields are trading around 4.68%, the USD Index is little changed near 99.90, EUR/USD is around 1.1535, GBP/USD near 1.35 and USD/JPY close to 159.40. The yen remains the most sensitive currency pair, with intervention risk still very much alive if dollar-yen pushes higher again.

We are very happy to have Ole back, because commodities — and not least precious metals — are moving back into the centre of the market discussion. Gold and silver have rebounded after resisting renewed selling pressure, and there are tentative signs that Western investment demand is beginning to recover. For gold, the 200-day moving average remains the key resistance level, roughly USD 100, or about 2.3%, above current levels.

This morning, gold is trading near USD 4,400 and silver around USD 65.10. The CPI print is likely to make or break the day for precious metals: a softer number would support the breakout attempt, while a sticky print could quickly bring yields and the dollar back into the driver’s seat.

Wall Street was softer on Tuesday, with the S&P 500 down 0.3% and the Nasdaq 100 also lower as the Strait of Hormuz deadlock pushed oil higher and investors held back ahead of today’s CPI. Communication services led the declines, while utilities and energy outperformed. The weakness was concentrated in large-cap technology and the Magnificent Seven basket, although earnings still produced some clear winners. Sea Limited’s ADRs jumped after stronger revenue and a raised profit forecast, while CoreWeave, Super Micro Computer and Lumentum all delivered encouraging after-hours updates.

Europe held up better. The Euro Stoxx 50 rose to a fresh record close, the DAX gained 0.3% to 26,391 and also reached a 52-week high, while the FTSE 100 was slightly weaker. The SMI slipped, with Roche and Givaudan weighing on the index. This morning, K+S and ThyssenKrupp both reported solid numbers, adding a bit of support to the German market tone.

Today’s CPI will give the market its cleanest read on the state of U.S. inflation and how much pressure remains on the Fed ahead of the September meeting. Current pricing is roughly balanced between a hike and no action, while futures still imply slightly more than one full hike by year-end. In other words, the market has not fully abandoned the higher-for-longer story — it has only become more willing to question it.

Unless we get a major surprise from the Middle East or the Bank of Japan, CPI should be the key event of the day. Cisco reports after the bell and will be closely watched as another read on enterprise technology and AI infrastructure demand.

Wednesday, 12 August 2026
Macro: U.S. Consumer Price Index for July; U.S. Monthly Budget Statement; weekly EIA crude oil inventory data.
Central banks / speakers: No major central-bank decision scheduled.
Corporate earnings: Cisco, Cardinal Health, Flutter Entertainment and selected European reporting names.
Thursday, 13 August 2026
Macro: U$K GDP U.S. Producer Price Index for July; U.S. initial jobless claims; EIA natural gas inventories.
Central banks / speakers: Beth Hammack and Thomas Barkin speak; Fed balance sheet after the close.
Corporate earnings: Applied Materials, Tapestry, Deere, Alibaba and selected European companies.
Friday, 14 August 2026
Macro: France CPI EU GDP U.S. retail sales for July; U.S. business inventories; preliminary University of Michigan consumer sentiment; Baker Hughes rig count.
Central banks / speakers: No major central-bank decision scheduled.
Corporate earnings: No major global large-cap earnings focus.