What Happened Last Week · What Is Coming This Week
Cooling inflation lifts stocks as the US consumer pulls back
Last Week
The week was shaped by the blockage in the Strait of Hormuz and by fresh tariff moves out of Washington. Lloyd's List Intelligence counted 78 transits through the strait between August 3 and 9, down from 95 the week before, while Tehran kept the release of frozen assets as its condition for reopening the waterway. Brent held in an $87-$89 range and WTI traded near $81, and the firmer energy complex capped risk appetite into the end of the week. The White House also announced tariffs on imported drones as the Pentagon stood up a multinational task force, sending defense and drone shares higher.
On the macro side, Wednesday's July CPI came in as expected at 0.1% month over month and 3.4% year over year, while core CPI eased to 2.5%, its lowest reading since March 2021. July PPI was flat on the month against a 0.2% consensus rise. Friday's retail sales then fell 0.6% month over month, the sharpest drop in 14 months versus expectations of a 0.1% gain, and the University of Michigan's preliminary August sentiment reading softened as well. The week's data set, in short, showed inflation cooling and the consumer tiring at the same time.
