UBS On-Air: Market Moves
CIO First Take: June CPI data & Market response
Jul 11, 2024
Join Senior Economist Americas, Brian Rose, and Senior US Equity Strategist, Nadia Lovell, as they discuss the June CPI data impact on monetary policy and markets. Topics include Fed's interpretation, expectations for rate cuts, market response, sector positioning recommendations, and insights on portfolio positioning.
12:28
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Quick takeaways
- June CPI data shows minimal inflationary pressure due to factors like healed supply chains and reduced consumer spending.
- Federal Reserve expected to cut rates in response to weakening data, with potential for more aggressive cuts in the future.
Deep dives
June CPI Print Reflects Low Inflationary Pressure
The June CPI print revealed a lower-than-expected inflation rate, with the headline CPI dropping month-over-month. Owner's equivalent rent, which had been stable, also showed a slowdown, indicating a return to pre-pandemic levels of increase. Factors such as healed supply chains and reduced consumer spending are contributing to decreased inflationary pressures. Furthermore, prices of items like used cars, which surged during the pandemic, are now declining. Overall, the data suggests minimal inflationary pressure in the current economic environment.
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