Next week's macro outlook: Fed's September rate cut expectations face ultimate judgment

PANews reported on August 9th that while this week's economic data was light, some data clearly indicated slowing demand. While US labor productivity remained strong, slowing economic activity and rising service sector prices suggest the market is experiencing signs of mild stagflation. Looking ahead to next week, the US will release three key data points: CPI, PPI, and terror data. These three releases may further reinforce market expectations of a September rate cut by the Federal Reserve. The following are key points for market attention in the new week:

Tuesday at 20:30, US July CPI data;

At 22:00 on Tuesday, Barkin, a 2027 FOMC voting member and president of the Richmond Fed, will deliver a speech;

At 01:00 on Thursday, Goolsbee, a 2025 FOMC voting member and president of the Chicago Fed, will deliver a speech on monetary policy;

At 01:30 on Thursday, Atlanta Fed President and 2027 FOMC voting member Bostic will deliver a speech on the outlook for the U.S. economy.

At 20:30 on Thursday, the number of initial jobless claims in the United States for the week ending August 9 and the July PPI data will be released;

At 02:00 on Friday, Barkin, a 2027 FOMC voting member and president of the Richmond Fed, will participate in a webinar;

At 22:00 on Friday, the preliminary value of the US one-year inflation rate forecast for August, the preliminary value of the University of Michigan Consumer Confidence Index for August, and the monthly rate of commercial inventories in June will be released.

If next Friday's retail sales data reveals deeper-than-expected economic distress, market expectations for a September rate cut and another before the end of the year are unlikely to change, but any CPI-induced dollar gains are likely to be limited and short-lived. More importantly, Trump remains willing to impose tariffs on more countries. Therefore, if the situation spirals out of control, further selling of US assets could occur in the near future.