Sticky Core CPI AT 2.9% Pressures Fed As Shelter, Energy Costs Climb

Food prices posted a 0.3%increase, Driven by Higher costs for beverages (+1.4%) and fruits and vegetables (+0.9%). Egg prices Droped Sharply by 7.4%, Thought Beef Saw A 2.0% GAIN. The Food Index Overall Rose 3.0% Year-Over-Year, With Food Away from Home UP 3.8%, Highlighting Persent Service Inflation.

Core Inflation Remains Sticky, Pressuring Fed Outlook Excluding Food and Energy, Core Cpi Rose 0.2% In June, Matching The Previous MONTH’S INCREASE. On an Annual Basis, Core Inflation Held Steady at 2.9%, Indicating Persenti Price Pressure in Service and Select Consumer Goods. Notable Increases Came from Medical Care Services (+0.5%), Household Furnishings (+1.0%), and Apparel (+0.4%). However, USD VEHICLE PRICES CONTINUED TO SLIDE, DOWN 0.7%, While New Vehicle Prices Fell 0.3%.

Airline Fares Declined Again (-0.1%), Helping Offset Service Inflation Elsewhere. Traders Should Note That Transportation Services Dipped 0.1% MONTH-OVER-MONTH, PETENTILLING EASING BROADER INFLIATION CONCERNS IN THIS CATEGORY.

Will The Federal Reserve React? The Uptick in Headline Inflation and Steady Core Pressure May Complicate the Federal Reserve’s Policy Outlook. While Year-Over-Year Inflation Remains Bead’s 2% Target, The Persent Core Readings and Strength in Shelter and Service Components Suggest Inflation is Not Yet Fully Under. Market Participants Should Monitor UpcomING LABOR DATA AND THE JULY CPI FOR ADDDITIONAL Policy Cues.

Market Forecast: Neutral to Slightly Bearish Short-Term Market Sentiment Leans Neutral to Slightly Bearish for Equities and Bonds. Persistant Core Inflation, Led by Services and Shelter, Could Keep The Fed Cautious About Rate Cuts. Treasury Yields May Remain Elegated in the Near Term, and Rate-Sensitive Sectors-Especialy Tech and Real Estate-May See See Added Pressure Unlessa incoming Data Show.