Cautious Market Sentiment Ahead of CPI Data

Market Overview

On the eve of the U.S. CPI inflation release, market sentiment turned cautious, pausing Wall Streets recent rally. The Nasdaq retreated from record highs, ending a three-day winning streak, while the S&P 500 and Dow also closed lower. The U.S. Dollar Index rebounded to its highest level in a week. Bitcoin experienced sharp volatility—after breaking above the $122,000 mark and nearing record levels, it sharply pulled back from the highs.

In commodities, gold saw a notable correction after hitting an all-time high, at one point falling nearly 3% intraday. Oil prices staged a reversal, recovering from losses of more than 1% intraday to close higher, pulling away from their lowest closing level in nearly two months.

Hot Topics to Watch

Gold Will Not Be Subject to Tariffs

Former President Donald Trump posted on social media, “Gold will not be subject to tariffs!” Following his remarks, spot gold saw little immediate reaction, holding a 1.58% loss. Later, it trimmed part of the decline, rebounding from around $3,341 to $3,354.61, though still ending the day down 1.2%.

Trump Administration Expands Fed Chair Candidate List

The Trump administration is considering adding Fed Governor Michelle Bowman, Fed Vice Chair Philip Jefferson, and Dallas Fed President Lorie Logan to the list of potential Fed Chair nominees. Last week, media reports indicated the expanded list also includes former St. Louis Fed President James Bullard and Marc Sumerlin, who served as an economic adviser during President George W. Bushs administration.

Key Events to Watch (GMT+8)

18:00 US – July NFIB Small Business Optimism Index

20:30 US – July CPI (y/y and m/m, not seasonally adjusted)

22:00 US – 2027 FOMC voter, Richmond Fed President Thomas Barkin speech

00:00 US – EIA Monthly Short-Term Energy Outlook