According to BlockBeats, Alexandra Wilson-Elizondo, Co-Chief Investment Officer of Multi-Asset Solutions at Goldman Sachs, stated that July's Consumer Price Index (CPI) data met expectations, with core inflation rising 3.1% year-over-year. The Federal Reserve finds support in this data, suggesting that the impact of tariffs on price levels is largely temporary. Tariffs have not led to significant price increases as companies mitigate cost pressures by reducing inventory and cautiously adjusting prices, given consumers' sensitivity to price changes.
The Federal Reserve's policy remains highly data-dependent. With inflation under control and revised employment data showing increasing signs of labor market weakness, future focus will shift more towards employment. Overall, this inflation report supports the expectation of a potential "insurance" rate cut by the Federal Reserve in September, which is anticipated to be a key market driver.