V3 Research
Market Uncovered: What the August 13 CPI Data Truly Reveals
BLS
The Bureau of Labor Statistics reports that the July 2025 Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) increased 0.1 % month-over-month and 2.5 % over the past 12 months, reaching 316.349 (1982-84=100).
BLS
Official BLS webpage listing the calendar for upcoming CPI press releases, confirming the August 12, 2025 publication date for July 2025 CPI data.
TradingEconomics
TradingEconomics records show U.S. CPI increased to 323.05 points in July 2025 from 322.56 in June, reflecting the latest monthly inflation reading.
BLS
The BLS PDF provides detailed July 2025 CPI tables, including headline and core indexes, component breakdowns, and seasonal adjustments.

Key Findings

  1. The July 2025 Consumer Price Index (CPI) report, published on August 12, 2025, revealed a headline inflation increase of just 0.2% month-on-month and 2.8% year-on-year. This slightly underperformed the 2.8% consensus and marked a softer pace compared to June 15161.
  2. Excluding the volatility of food and energy prices, core inflation climbed by 0.3% month-on-month, reaching a 5-month high of 3.1% year-on-year. This points to persistent underlying price pressures 1118.

1. Headline CPI Insights

  • The Bureau of Labor Statistics (BLS) data indicate that the overall CPI index rose to 323.05 points, reflecting a 0.2% monthly gain 3.
  • The CPI-W, another key measure, increased by 0.1% month-on-month and 2.5% year-on-year, underscoring the modest pace of price growth 1.
  • The BLS release schedule confirms that the July data were published on August 12, 2025 2.

2. Core Inflation Dynamics

  • With a 0.3% monthly uptick, the core CPI reached a 3.1% year-on-year rate—exceeding expectations and remaining well above the Fed’s 2% target 1112.
  • Analysts highlight that core inflation, rather than the headline metric, poses the key challenge for policymakers 18.

3. Market Reactions & Policy Implications

  • The release bolstered CME FedWatch probabilities for a September rate cut, which leapt to 96% 5.
  • On August 13, U.S. stocks opened strongly as traders anticipated a more accommodative monetary policy, with significant gains observed in indices such as the Dow and Nasdaq, while rate-sensitive small-caps outperformed 13.
  • Broader analyses noted a 'risk-on' trend across tech giants, small caps, emerging markets, and crypto assets, driven by the optimistic view that softer CPI data could pave the way for easier monetary policy 146.

4. Why It Matters

  • Despite the headline inflation easing, the elevated core inflation presents a dilemma for the Federal Reserve, which must balance the softer overall price increases with persistent underlying inflationary pressures 1117.
  • Investor sentiment is leaning towards further monetary easing, a stance that could help sustain looser financial conditions into the autumn cycle.
19 days ago