BlockBeats news, on August 13, QCP released its daily market observation stating that the U.S. July CPI (Consumer Price Index) rose by 2.7% year-on-year, lower than the market expectation of 2.8%; core CPI rose by 3.1% year-on-year, slightly higher than the expected 3.0%. The relatively mild overall inflation reading has strengthened expectations for the Federal Reserve to begin a rate-cutting cycle in September, with most market participants currently expecting a 25 basis point cut. Previously anticipated to rise due to companies passing higher costs onto consumers, commodity inflation, however, performed lower than expected this time.
After the data was released, the market's expectations for rate cuts in 2025 remained unchanged, with pricing still reflecting a rate cut space of approximately 60 basis points. Although the labor market is softening, and the market expects a more dovish Federal Reserve Chairman in 2026, the terminal rate remains stable. Futures positions indicate that investors believe the Federal Reserve's rate floor in 2026 will be around 3%.
As several key risk events have unfolded, U.S. stocks continue to rise and set new historical highs. In terms of tariff confrontations, 'TACO' remains a core reference for traders, with the extension of the tariff deadline between the U.S. and China being extended by 90 days. The geopolitical situation between Ukraine and Russia has eased, with escalation risks seen as a distant possibility, and a ceasefire or peace agreement has become the market's baseline scenario.
In the cryptocurrency market, long-term holders of ETH are finally experiencing excitement, with the ETH price approaching historical highs. The financing raised by Bitmine for establishing an ETH treasury has attracted attention, with the market noting that compared to Bitcoin, any inflow of funds into ETH has a more significant impact, as ETH has a smaller market cap and slightly thinner liquidity. As long as funds continue to flow into ETH DAT (Decentralized Asset Token), the current upward momentum of ETH is expected to continue.
Looking ahead, the Jackson Hole Annual Meeting will become the next focal point. It is expected that Federal Reserve officials will signal a 25 basis point rate cut at the meeting. With only one more CPI and one non-farm payroll data release before the September FOMC meeting, these data are not expected to substantially change the Federal Reserve's decision.
