The US consumer price index rose moderately in July, but European stock indexes dipped and Wall Street futures were flat.

The consumer price index gained 0.2%, the same as in June, reducing the likelihood of a Federal Reserve rate hike next month.

San Francisco Federal Reserve Bank President Mary Daly said more work was needed before the Fed had done enough to battle inflation, dampening investor optimism.

Asian markets sank to a one-month low, while the MSCI World Equity index fell 0.3%.

Investors awaited US producer price and consumer sentiment data later in the session.

The Australian central bank head said policy was at the “calibration stage” as inflation has peaked, but more tightening may be needed based on data and risks.

China’s deflation raised concerns about slower economic growth like Japan’s “lost decades.” The dollar index was down 0.1% but on course for its fourth weekly gain.