The Bureau of Labor Statistics releases July CPI at 8:30 a.m. ET today. Economists expect 3.4% annual inflation, down from June's 3.5%. Core CPI is forecast at 2.5%, slipping from 2.6%. Dow futures climbed pre-open; options markets already price a 70% probability of a Fed 25-bps cut in September. S&P 500 closed at 7,728 on August 11. The disinflation path since the March tariff spike — 3.8%, 3.6%, 3.5%, now forecast 3.4% — shows pass-through has been gradual, not the inflationary shock leftist commentators predicted.
1
Pre-open positioning
S&P 500 closed at 7,728 on August 11. Communication Services posted a Q2 EPS beat of +102.3% versus estimates; Consumer Discretionary at +100.4%. Dow futures up 0.4%, Nasdaq +0.3% ahead of the open. A confirming 3.4% CPI print gives the September FOMC pivot trade its second consecutive supporting data point after June's cool read.
2
Rate-cut timeline
After June's CPI met forecasts, Fed-funds futures moved September cut odds from 50% to 70%. A 2.5% core print reopens the three-cut 2026 path. Watch the 2-year Treasury: it fell 8 bps on the June release. A similar move today would signal markets believe the Fed is on track to deliver before year-end.
3
Tariff pass-through absorbed
Tariffs phased in from March drove May CPI to 3.8% — the cycle peak. The subsequent deceleration — 3.6%, 3.5%, now forecast 3.4% — shows corporate margin absorption exceeded consumer pass-through. That is the opposite of the 'tariff hyperinflation' narrative that dominated Q1 commentary from Wall Street desks.
Print at 8:30 ET. A 3.4% read restarts the September cut conversation in earnest. Watch the 2-year yield.
Sources
- ✓ BLS — Consumer Price Index Summary, July 2026 — Aug 12 2026
- ✓ NBC News — July 2026 CPI Report: Inflation Expected to Stay Steady — Aug 12 2026
- ✓ TheStreet — Stock Market Today: Dow Futures Climb Ahead of Key Inflation Report — Aug 12 2026
- ✓ FactSet — Earnings Insight Q2 2026 — Aug 12 2026
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