Core Market Logic This Week: Fed to Pause in September?

U.S. July CPI, PPI, and retail sales data all softened, compounded by cooling employment, driving market odds of a September Fed rate hike down sharply from 75% to 25% and lifting global equities for a third consecutive week. However, oil prices remain elevated, the U.S. Treasury yield curve has steepened, and the long end of the bond market continues to price in inflation and fiscal deficits. The Jackson Hole symposium in two weeks will serve as a key barometer.