Squawk on the Street SOTS 2nd Hour: PPI Concerns, Charles Schwab’s Chief Strategist, & LIVE: St. Louis Fed President Musalem 8/14/25
Aug 14, 2025
In this discussion, Alberto Musalem, President and CEO of the Federal Reserve Bank of St. Louis, shares crucial insights on inflation and labor market dynamics. Liz Ann Sonders, Chief Investment Strategist at Charles Schwab, analyzes how producer price data is affecting financial markets. They delve into the implications of tariffs on consumer prices and the delicate balance policymakers must strike amid economic uncertainties. Together, they explore potential rate adjustments by the Fed and the overall market's reaction to these economic indicators.
AI Snips
Chapters
Transcript
Episode notes
PPI Rise Is Not Pure Tariff Signal
- July PPI surprised to the upside but much of the move reflected portfolio management fees and airfares, not just tariffs.
- That makes the print less of a clean signal that tariffs alone are driving persistent broad inflation.
Services, Not Just Goods, Drove PPI
- Services drove most of July's PPI increase, complicating the narrative that tariffs are the main culprit.
- Markets should weigh service inflation separately when judging Fed cut odds.
Mega Caps Are Flattering Index Gains
- Index gains are narrow and driven by mega-cap leadership, masking weak broad participation.
- Under the surface, breadth metrics show many stocks are not keeping pace with the rally.