US inflation expectations can be held responsible for the market’s latest dislike for the US Dollar, after fueling the Greenback to the multi-day high in the last week.

That said, the inflation expectations, as per the 10-year and 5-year breakeven inflation rates from the St. Louis Federal Reserve (FRED) data, reverse Friday’s corrective bounce while declining to the fresh lows in five weeks.

It should be noted that the 5-year and 10-year inflation expectations per the aforementioned calculations fall to 2.21% and 2.30% at the latest.

It’s worth observing that the Fed officials’ inability to please markets with a major hawkish surprise can join the latest weakness in the US inflation clues to weigh on the US Treasury bond yields and the Greenback.

However, the cautious mood ahead of today’s US Conference Board’s (CB) Consumer Confidence Index for August, expected at 116.2 versus prior 117.00, will prod the Greenback and the markets. Above all, major attention will be given to the Fed’s preferred inflation gauge, namely the US Core Personal Consumption Expenditure (PCE) Price Index for July and Nonfarm Payrolls (NFP) for August