Inflation Heats Up While Wall Street Bets on Rate Cuts Anyway

Benzinga

July’s inflation report just sent mixed signals and Wall Street is already making bold moves.  Overall prices cooled, with headline inflation holding at 2.7%, under expectations. But the number economists watch most, core inflation, jumped to 3.1%, the highest since February.  Driven by rising costs in medical care, airline fares, furniture, and used cars plus new tariffs from Trump’s latest wave, the pressure could still hit consumer wallets later this year.  Yet despite the hotter core inflation, traders are still betting on multiple Fed rate cuts in 2025.

Transcript

00:00The inflation report just sent mixed signals and Wall Street is already making bold bets.

00:05In July, overall prices cooled headline inflation stayed at 2.7% under expectations.

00:11But the hidden number economists watch, it actually got hotter.

00:14Core inflation, which ignores food and energy, jumped to 3.1%.

00:19This is the highest it's been since February.

00:21This is fueled by medical care, airline fares, furniture, and used cars.

00:26And tariffs from Trump's latest wave, so far barely a dent in the big picture.

00:31But economists warned they could still hit your wallet later this year.

00:35But here's the twist, even with hotter core inflation, traders still expect multiple Fed

00:39rate cuts this year.

00:40So do you think the market's just being bold or reckless?

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