The currency market showed a relatively subdued reaction to the US inflation report for August, which nevertheless indicated that monthly core inflation was higher than expected at 0.3% (forecasted 0.2%). The dollar index, after a brief upward movement, began to decline. The Treasuries market also did not perceive hawkish risks in the report, prompting investors to engage in fairly confident buying of Treasury bonds following the news: {chart} Headline inflation accelerated from 3.2% to 3.7% on an annual basis (forecasted 3.6%), while core inflation remained unchanged compared to the previous month, standing at 4.3%. ... (full story)