BNP Paribas argued that after the latest CPI and PPI data, Federal Reserve officials should have all the necessary indicators to arrive at the September FOMC meeting ready to announce a first interest rate cut since 2020.
“The details of “The July CPI report, which remains in line with growth, continues to tell a disinflation story that should persist for the rest of the year, in our view,” BNP Paribas said in a note to investors on Wednesday.
The investment institution added: “The CPI report should be the last piece of data needed for Fed officials to have confidence that inflation is sustainably heading toward 2%, clearing the way for a rate cut in September.”
According to the CME FedWatch tool, for the next FOMC meeting on September 18, the probability of a 25 basis point rate cut is located at 56.5%, while a rate cut greater than 50 basis points is located at 43.5%.
These figures are slightly different from the readings before the last CPI was published. Before the publication, the probability of a cut greater than 50 basis points was 52.5% and that of a cut of 25 basis points was 47.5%.
Investors who want to keep pace with the market can turn to exchange-traded funds that mirror the price movements of benchmark averages, as well as bond and Treasury funds. See some funds below:
Market Tracking ETF: (DIA), (DDM), (UDOW), (DOG), (DXD), (SDOW), (SPY), (VOO), (IVV), (RSP), (SSO), (UPRO), (SH ), (SDS), (SPXU), (QQQ), (QQQM), (QLD), (TQQQ), (QID) and (SQQQ).
Treasury Bond ETF: (TLT), (TLH), (IEF), (IEI), (SHY), (SGOV), (SCHO) and (BIL).
Bond ETF: (AGG), (BND), (VCIT), (MUB), (MBB), (JNK), (LQD), (HYG) and (TIP).
