Wu Says This Week’s Macro Indicators and Analysis: US Inflation Indicators CPI and PPI, and the Federal Reserve’s Semiannual Monetary Policy Report

Compiled by GaryMa, Wu Says Blockchain

Summary

Last week, the U.S. Federal Reserve launched a reassessment of its monetary policy framework. The meeting minutes showed that disagreements still exist within. U.S. employment data remained stable, inflation pressure in the eurozone intensified, and China’s June CPI fell. This week, attention is focused on U.S. inflation indicators including CPI and PPI, as well as the Federal Reserve’s semiannual monetary policy report.

Last Week in Review

Over the past week, fighting between the U.S. and Iran flared up again around the Strait of Hormuz. Iran attacked multiple merchant ships and announced a blockade of the strait. The U.S. then carried out consecutive airstrikes on Iranian missiles, drones, and its naval and communications facilities. Iran, in turn, responded with missile and drone attacks on U.S. military targets in Gulf countries including Qatar, Kuwait, and Bahrain. Trump announced that the previous ceasefire had ended. Although both sides were still in contact through channels such as Oman, the conflict had clearly spilled over, and risks to global shipping and energy supply rose further.

The Federal Reserve announced the formation of five independent working groups to re-evaluate its monetary policy framework, covering areas including communication mechanisms, balance sheet policy, the data system, the impact of AI on productivity and employment, and the inflation framework. Working group members include a16z co-founder Marc Andreessen, Nobel laureate Thomas Sargent, Harvard professor Greg Mankiw, Anthropic researcher Charles Jones, and others. Federal Reserve Chair Kevin Warsh said the U.S. economy is undergoing major changes, and the Fed needs to re-examine its analytical tools and policy approach to better achieve its goals of price stability and full employment.

In the U.S., initial jobless claims for the week ending July 4 were 215,000, versus 218,000 expected. The prior figure of 215,000 was revised to 217,000.

The Federal Reserve’s monetary policy meeting minutes showed: differences within the organization; the outlook for inflation and interest rates remains unclear.

The ECB released its June meeting minutes: there is consensus on upward risks to inflation, and pricing for up to three rate hikes within the year continues to build.

China’s June CPI rose 1% year over year, below expectations, and declined compared with the previous month.

Key Events & Indicators This Week

July 14

U.S. June CPI year over year, unadjusted (20:30)

Fed Chair Worsh appears before the House Financial Services Committee for the “Fed Semiannual Monetary Policy Report” hearing (22:00)

July 15

U.S. June PPI year over year (20:30)

Fed Chair Worsh appears before the Senate Banking, Housing, and Urban Affairs Committee for the “Fed Semiannual Monetary Policy Report” hearing (22:00)

July 16

The Federal Reserve releases the Beige Book on economic conditions (02:00)

U.S. initial jobless claims for the week ending July 11 (in ten-thousands) (20:30)

July 17

Fed Vice Chair Jefferson delivers remarks on the economy and monetary policy (07:00)

U.S. July one-year inflation rate expectations, initial value (22:00)

U.S. July University of Michigan consumer sentiment index, initial value (22:00)