What you need to know before the most critical US inflation of the year

All attention in global markets has turned to US inflation data. It is anticipated that the upward momentum in service sector prices will continue in inflation. Economists participating in the Bloomberg survey expect annual inflation to decline to 7.9 percent. Following the data indicating a strong labor market in terms of newly created employment in the US, the October CPI data that will determine the Fed's interest rate path will be announced at 16:30. The median expectation of 53 economists participating in the Bloomberg survey indicates that inflation will decline from 8.2 percent in September to 7.9 percent. The CPI excluding food and energy is expected to decline from 6.6 percent to 6.5 percent. According to Bloomberg economists Anna Wong and Andrew Husby, the CPI data to be released today will provide both hawks and doves with the opportunity to support their theses. Wong and Husby believe that a general disinflation, especially in goods prices, may support the doves' view that the Fed will stop in the near future. However, the high course of services inflation may also be a point that hawks who want a higher final interest rate will pay attention to. Economists, who point out that markets may rally as a result of a possible softening in the core CPI, still emphasize that the annualized monthly inflation rate is well above the Fed's 2 percent target.