Fed Rate Hike Probability Drops to 44%, U.S. July CPI to Be Released

On August 8, the reopening of the Strait of Hormuz led to a significant drop in oil prices, and the unexpected decrease in U.S. non-farm payrolls for July caused the market's probability of a Fed rate hike in September to fall from about 55% to 44%. The three major U.S. stock indices recorded their largest weekly gain since mid-April, while spot gold rose to $4,370 per ounce. Next week, the earnings season for U.S. semiconductor companies will come to a close, with AI technology stocks being highly sensitive to the upcoming earnings reports from Applied Materials (AMAT), Cisco (CSCO), and CoreWeave (CRWV). The focus will shift to inflation data, with the U.S. July CPI and core CPI set to be released on Wednesday, testing whether rate hike expectations can continue to cool. The PPI will be released on Thursday, followed by retail sales and the Michigan Consumer Sentiment Index on Friday. There are still divisions within the Fed, with Chairman Waller remaining silent, and the market will closely monitor officials' speeches and independence risks. Key events next week include: on Monday, the Bank of Japan will release the summary of opinions from its July monetary policy meeting; on Tuesday, the ADP employment numbers for the week ending July 25; on Wednesday, CoreWeave (CRWV) earnings call, U.S. July CPI, and EIA crude oil inventories for the week ending August 7; on Thursday, Cisco (CSCO) earnings call, initial jobless claims for the week ending August 8, and U.S. July PPI; on Friday, Applied Materials (AMAT) earnings call, U.S. July retail sales month-on-month, and the preliminary Michigan Consumer Sentiment Index for August.

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