Dow Jones futures edge lower as investors remain cautious before the release of CPI inflation figures

US Stock Futures Dip Ahead of Key Inflation Data

During Tuesday's European trading hours, Dow Jones futures slipped by 0.09% to approach 49,750, while S&P 500 and Nasdaq 100 futures also retreated, down 0.08% to around 7,010 and 0.14% to near 25,920, respectively. The US equity futures market is treading cautiously as investors await the release of December’s Consumer Price Index (CPI) later today, seeking insights into the Federal Reserve’s next policy moves.

Market participants are on edge amid heightened scrutiny of the Fed’s autonomy. US federal prosecutors have launched a criminal probe into Fed Chair Jerome Powell following his congressional testimony about a renovation project. Meanwhile, the Trump administration continues to urge the Fed to lower interest rates, with Powell describing these efforts as an attempt to sway monetary policy under false pretenses.

On Monday, Wall Street ended the session in positive territory, buoyed by gains in consumer staples, industrials, and materials sectors. The Dow Jones climbed 0.17%, the S&P 500 rose 0.16%, and the Nasdaq 100 advanced by 0.26%. Investors are also turning their attention to JPMorgan’s fourth-quarter earnings, with other major banks such as Bank of America, Wells Fargo, Citigroup, Morgan Stanley, and Goldman Sachs set to report results later this week.

Current market expectations suggest the Federal Reserve will implement two interest rate reductions this year, beginning in June. According to CME Group’s FedWatch tool, there is a 95% chance that interest rates will remain steady at the upcoming January 27–28 policy meeting.

Projections for US inflation indicate a year-over-year rate of 2.7% for December 2025, with core inflation anticipated to edge up to 2.7% from 2.6%—the lowest level since early 2021. Both headline and core CPI figures are expected to rise by 0.3% month-over-month, mainly due to increased goods prices. Should inflation exceed forecasts, the Federal Reserve may face limitations in its ability to loosen monetary policy.