Happy CPI day, market watchers. The latest inflation report is due at 8:30 a.m. ET today, and some economists expect to see tariffs start to show up in the data. Then again, that hasn’t happened in any of the releases so far this year.

Old and new inflation data

The Federal Reserve is about to get fresh data that could either confirm its delayed policy response or justify its patience on rate cuts.  

Economists expect June CPI to come in at 2.6% year-over-year, according to FactSet.

That would be higher than the 2.4% seen the month prior, and it would mark the highest rate since February’s 2.8%. 

Fed Chair Jerome Powell has maintained that he expects President Trump’s tariffs to push inflation higher, and so his team has refrained from cutting interest rates.

That outlook, though, hasn’t materialized. 

As Opening Bell Daily readers know, inflation has in fact come in cooler than expected every month of 2025 so far.

Mapping out the 12-month rolling average for annual inflation underlines that trend.

Meanwhile, according to Truflation, inflation has already fallen below the Fed’s 2% target. 

Truflation is an alternative metric that tracks thousands of data points on price growth, and it shows inflation hovering at 1.71%. 

On top of that, the Misery Index — the sum of the year-over-year inflation and unemployment rates — has fallen toward pre-pandemic levels. 

At 6.5%, it’s also well below its long-run average of 9.0%. 

Still, neither traditional markets nor prediction platforms see the Fed adjusting course anytime soon. Traders see effectively no shot of a July rate cut, according to CME’s FedWatch Tool, and 40% of no move in September. 

To be sure, the Cleveland Fed’s Nowcasting model is showing a 3.0% year-over-year inflation rate for June, up from 2.8% in May. 

“So far, the impact of Trump's tariffs has been difficult to spot in hard inflation data,” said Yardeni Research founder Ed Yardeni. “That may be about to change, albeit modestly, with June's CPI report.” 

Central bankers, among other academics and economists, believe it’s only a matter of time before we see tariff effects show up in inflation.

Seema Shah, chief global strategist at Principal Asset Management, said she expects tariffs to ultimately deliver a one-time inflation shock of about 1.5%.  

Investors, for their part, continue to pile into stocks and crypto with such enthusiasm that “risk on” actually understates it.

New tariffs announcements out of the White House haven’t stopped a series of record highs for the S&P 500 and bitcoin, as well as historic inflows to bitcoin ETFs.

Nancy Tengler, chief investment officer of Laffer Tengler Investments, said retail investors should now be considered the “smart money” in markets.

She believes the cohort will continue to push risk assets higher through year-end, regardless of what the Fed does.

“We have discussed numerous times the $7 trillion in cash on the sidelines, an overweight retail investor, and share buy back desks purchasing record amounts of stocks,” Tengler said.

“This is juxtaposed against the institutional investor cohort, who remain way underweight US equities.” 

Market snapshot

A message from our partner: BitcoinIRA

Why smart investors use BitcoinIRA:

• Tax Savings: When you trade in an IRA, you don't have to pay capital gains taxes that can be as high as 37% 

• Top-Level Security: Assets are custodied with a US based custodian and insured up to $250M²

• World Class Customer Service: BitcoinIRA has a team of IRA specialists that will help guide you through every step of the process

Take 3 minutes to open your account & get access to over 75 cryptocurrencies in your IRA.

P.S. As an Opening Bell Daily reader, you can earn up to $500 in rewards* when you add funds to your account.

Elsewhere

🖥️ Nvidia said the US will allow it to resume chip sales to China. Shares of Nvidia surged overnight after the company announced it’ll soon be clear to sell its previously restricted H20 GPU chips to clients in China. (Reuters)

🏦 Big banks start reporting earnings. Citi, JPMorgan and Wells Fargo kick off with quarterly results Tuesday, followed by Bank of America, Goldman Sachs, and Morgan Stanley Wednesday.

🚢 President Trump threatened 100% tariffs on Russian export buyers. He said he’s “dissapointed” in Russia’s Putin over the ongoing war in Ukraine, and he said Russia must do a deal in 50 days or else face trade punishment. He also announced Monday that the US would send more military support to Ukraine. (CNBC)

Rapid-fire

• Traders see 93% odds the Fed doesn’t change rates in July (Kalshi)

• Elon Musk floated Tesla as a new source of funding for xAI (WSJ)

• There’s a reason bitcoin’s latest rally is so sharp and so fast (Pomp Letter)

• Fed Powell asked inspector general to review a central bank building expansion that’s drawn scrutiny from the White House (CNBC)

• Bitcoin’s dominance against the stock market explained in 1 chart (Opening Bell Daily)

• Starbucks employees must return to office four days a week or take a pay cut (CNBC)

• Andrew Cuomo will run for NYC mayor as an independent after his surprise defeat to Zohran Mamdani in the Democratic primary (WSJ)

Steal the trades of elite investors

Join our Best Ideas Club to unlock our members-only stock tracker, where you can see the names in a high-conviction portfolio that’s up 14% in five months, outpacing the S&P 500.

Instant access.

Last thing

About me

📰 I’m Phil Rosen, co-founder and editor-in-chief of Opening Bell Daily. I’ve published books, lived on three continents, and won awards for my journalism, which has appeared in Business Insider, Fortune, Yahoo Finance, Bloomberg and Inc. Magazine.

I write our flagship newsletter to prepare you for each trading day — unpacking markets, economic data and Wall Street with analysis you won’t find anywhere else.

Feedback? Reply to this email, ping me on X @philrosenn, or write me directly at [email protected].