There is only a 3 percent chance of a cut in July. September looks like a coin toss.

Rate cut odds from CME Fedwatch.
 

Two days ago I was laughing at reports of a surprise rate cut in July. Following the CPI report, not even September looks safe.

Meanwhile the rumor mill on replacing Fed chair Jerome Powell is running rampant.

Breaking Rumors

Forgive me for asking but WTF does she know? And why?

Not saying it won't happen, but she is not in a position to know.

So this is best viewed as bullshit. https://t.co/57JqxZiIo5

— Mike "Mish" Shedlock (@MishGEA) July 16, 2025

And From Pulte

Dear @pulte
You are a lying partisan self-serving hack in a position you got because you are a lying partisan self-serving hack.

Year-Over-Year CPI Jumps 0.3 Percentage Points to 2.7 percenthttps://t.co/9qUBMbP0yy https://t.co/JClHPMJIx2

— Mike "Mish" Shedlock (@MishGEA) July 16, 2025

“Pulte confident Powell will resign.”

Yeah, right.

Dear @SenLummis I believe you might be as stupid as you sound after today.

Year-Over-Year CPI Jumps 0.3 Percentage Points to 2.7 percenthttps://t.co/9qUBMbP0yy https://t.co/cWNllDUShV

— Mike "Mish" Shedlock (@MishGEA) July 16, 2025

Is the Next Fed Move a Cut?

I am not convinced the answer is yes, but currently I think so. Regardless, there is a wide range of outcomes including stagflation and an economic collapse.

If jobs stay firm and tariffs ignite inflation, the Fed might be temped to hike.

It’s important to understand no one knows what Trump will do with tariffs or how the market will react. That is how I see things and that is how the Fed sees it also.

Repeating my past statements: There should not be a Fed. But the one thing worse than an independent Fed is one controlled by the president.

Related Posts

2025-07-15: Year-Over-Year CPI Jumps 0.3 Percentage Points to 2.7 percent

Month-over-month and year-over-year the CPI rose 0.3 percent.

2025-07-15: Real Hourly Earnings of Private Workers Decline 0.1 Percent in June

Inflation-adjusted wages fell in June. A decline in hours worked makes it worse.

More By This Author:

Real Hourly Earnings Of Private Workers Decline 0.1 Percent In June
Year-Over-Year CPI Jumps 0.3 Percentage Points To 2.7 percent
Trump Threatens 100% Tariffs On Russia Over Ukraine, So What?