Overview
- The Bureau of Labor Statistics will publish July’s Consumer Price Index on Wednesday and economists expect only a modest monthly rise that could either ease or revive pressure on the Fed to act.
- Last Friday’s jobs report showed a loss of 23,000 payrolls and downward revisions to prior months which have weakened the near‑term case for a rate increase.
- The Federal Open Market Committee was split at its July meeting with a 9‑3 vote to hold rates and three officials favoring a 25 basis point hike, exposing the decision to new data.
- Rising oil prices tied to U.S.‑Iran tensions raise upside inflation risk that could push markets to price in higher odds of a September hike.
- Traders and models now treat a September hike as roughly a coin flip and will watch July CPI together with upcoming PCE data Jackson Hole commentary and further jobs reports for the Fed’s next clear signal.