US inflation data shows:
July CPI year-on-year rate at 2.7%, below the expected value of 2.80%, unchanged from the previous value of 2.70%; July core CPI year-on-year rate at 3.1%, above the expected value of 3.00%, higher than the previous value of 2.90%; July's CPI roughly meets expectations, enough to lock in the possibility of a rate cut in September.
US Treasury Secretary Yellen calls for the Federal Reserve to initiate "compensatory" rate cuts, stating that rates should be lowered by 150-175 basis points, with a potential initial implementation of a 50 basis point "compensatory" cut in September, which may mark the beginning of consecutive rate cuts to make up for the missed policy adjustment window in early summer this year.
A single rate cut is bearish, while three rate cuts are bullish. If there is only one rate cut, it cannot be considered bullish; if there are three consecutive rate cuts, it represents a trend of bullishness, which can be referenced by last year's trend of three rate cuts from September to December. It is expected that there will be 3-5 rate cuts by mid-next year, which is favorable in terms of trends. Attention should be paid to Powell's stance on rate cuts at the Jackson Hole annual meeting on August 21. Also, be aware of the risks.