Core CPI puts the sticky part of inflation on trial

Core CPI strips out food and energy and usually gets the most attention from rate watchers. Last month was 0.2%, so this release will help decide whether the sticky part of inflation is really easing or just moving sideways.

Core CPI is the cleaner read on sticky inflation, so the market will care less about one-off swings and more about whether the underlying pace is still too hot. A firm core print would keep pressure on yields and make the case for an easier policy path weaker. A softer core number would do the opposite and give rate-sensitive parts of the market some breathing room.

Core inflation matters for the policy path, and the policy path drives discount rates. Technology usually reacts strongly because its valuations are built on future cash flows, not just today's earnings.