Inflation data appear to have cemented the market’s view of a quarter-point rate cut next week, but beyond that they have provided little clarity. Traders now see a 99% chance of a cut on Dec.18, up from 71% a week ago,

Gold gained on Wednesday after an inflation print came in line with expectations, boosting the likelihood of a Federal Reserve rate cut next week, while investors awaited U.S. Producer Price Index (PPI) data for further direction on monetary policy.

Inflation is moving in the wrong direction. U.S. inflation picked up for a second straight month in November on a rise in food and gasoline prices, underscoring that the final stretch of the Federal Reserve's two-year battle against sharply rising prices has become more challenging.

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Traders of interest-rate futures that settle to the Federal Reserve's policy rate added to bets the central bank rate will cut borrowing costs next week and follow up next year with further reductions,

A key measure of U.S. wholesale inflation posted a small increase in November and probably added the final nail in the coffin of a widely expected reduction in interest rates next week. Back To Top

The market sees the probability of another 25 basis point interest rate cut at next week's Federal Reserve meeting as rising despite inflation ticking higher in November.

Inflation sped up last month, but the details suggested cooling ahead. Next week, the Fed will make its final rate decision for 2024.