U.S. to Release December CPI Data Tonight as Price Pressures Expected to Remain Stubborn

The U.S. will release its December Consumer Price Index (CPI) data tonight at 9:30 PM, a closely watched metric for inflation trends. The market generally expects price pressures to remain stubborn, which could influence monetary policy decisions. The data will provide insight into the Federal Reserve's next steps following a year of economic uncertainty.

Egypt's inflation rate was unchanged in December, potentially giving the central bank scope to further cut borrowing costs in 2026. Consumer-price growth in urban areas was 12.3%, the same level as the month before, state statistics agency CAPMAS said Saturday. On a monthly basis, inflation was 0.2% versus 0.3% in November.

The reading is a closely watched metric in the Middle East's most populous country, which has been striving to tame inflation that soared to a record 38% in September 2023. The country secured a $57 billion global bailout the following year. While the headline number has more than halved in the past 12 months, any decline into single-digit figures has been hampered by recent IMF-backed cuts to subsidized items such as fuel.

Inovio Pharmaceuticals remains speculative due to its pending FDA approval for INO-3107, a potential treatment for rare diseases. The company is requesting a meeting to discuss next steps to stay eligible for the accelerated approval program. Management also mentioned they're not planning to seek traditional approval that would require more data. INO will insist on the FDA opting for the accelerated approval pathway.

Cuba's economic struggles continue, with uncertainty over government stability. The CIA warned of a grim economic situation in the country but expressed uncertainty about whether the government would collapse. People are increasingly focused on putting food on the table rather than political issues. On the other hand, desperation could lead to public unrest.

Trump pushes for lower interest rates, signaling potential policy shifts. He directed the federal government to buy $200 million in mortgage bonds using cash from Fannie Mae and Freddie Mac in an effort to drive down mortgage rates. The president has also urged the Federal Reserve to more aggressively cut its benchmark interest rate.

Why the Move Happened

Egypt's inflation stability has been attributed to lower fuel prices and a recent law amendment that hiked rents for millions of properties. Although food and beverage prices, the largest component of the inflation basket, rose 1.5% on an annual basis in December, they fell 0.7% on a monthly basis. These dynamics are key to understanding the country's inflationary pressures.

Inovio's speculative nature is further underscored by its thin cash runway and dependence on the FDA's decision on INO-3107. According to its latest 10-Q report, the company had around $50.8 million in cash and short-term investments, with management anticipating the cash runway would extend into Q2 2026.

How Markets Responded

Investors are closely watching Egypt's inflation figures for signs of continued economic stabilization. A stable reading could support further rate cuts and encourage private-sector investment, as authorities have indicated there'll be no more hikes in local fuel prices until October. Lower interest rates could help reduce the government's interest burden, which is a significant chunk of state spending.

Meanwhile, Inovio's stock remains volatile due to its dependence on a single product's regulatory approval. The company trades at a $110.6 million market cap, and even small buy or sell orders can significantly impact its stock price. This volatility makes it a high-risk investment.

The U.S. CPI data will also influence market sentiment. A higher-than-expected reading could delay further rate cuts by the Fed and increase borrowing costs for consumers and businesses. Conversely, a lower reading could support the Fed's aggressive monetary easing and boost risk-taking in financial markets.

What Analysts Are Watching

Analysts are paying close attention to Egypt's central bank's next steps following the stable inflation data. Goldman Sachs Group Inc. forecasts another 700 basis points of cuts in 2026, suggesting a strong case for continued monetary easing if inflation remains stable.

For Inovio, the key event is the FDA's decision on INO-3107. The company's ability to secure accelerated approval will determine its next phase. Failure to do so could significantly impact its revenue projections and long-term viability.

Cuba's situation remains a geopolitical concern. The CIA's warning highlights the economic and social instability in the country. Analysts are watching for signs of mass protests or further economic deterioration that could prompt international intervention.

Trump's push for lower interest rates and government-driven mortgage support signals a potential shift in U.S. economic policy. While the Fed has the final say on benchmark rates, the administration's pressure could influence future monetary policy. Investors are closely monitoring the Fed's nominee selection and policy direction.