Price support remains at 97.899, with a failure to hold that level exposing downside toward 97.342.
CPI Undershoots Forecasts, Treasurys Rally Across the Curve
June’s CPI report showed inflation broadly in line with expectations, though the core reading came in slightly light.
Headline CPI rose 0.3% month-over-month for an annual gain of 2.7%, while core CPI climbed 0.2% on the month and 2.9% year-over-year. That modest undershoot pushed Treasury yields lower: the 10-year dropped three basis points to 4.401%, the 30-year yield fell to 4.945%, and the 2-year held near 3.889%.
With inflation appearing contained, Fed funds futures now price in 50 basis points of easing by year-end, with markets favoring a first cut in September.
Powell Under Political Fire as Trump Renews Rate Criticism
Political pressure on the Federal Reserve continues to rise after White House Economic Director Kevin Hassett confirmed legal reviews into whether President Trump could lawfully remove Chair Jerome Powell.
Though Trump has signaled he won’t take immediate action, his public demand for a 1% policy rate underscores growing tensions over the Fed’s current 4.25%-4.50% range.