Analyst Matthew Weller says whether inflation has peaked is the market’s key
question ahead of June CPI. A partial reopening of the Strait of Hormuz in
mid‑June — the first in three months — pushed energy prices sharply lower, and
the lagged effects of Trump’s now‑expired "Liberation Day" tariffs appear
largely priced in. Traders and economists now expect overall monthly CPI to post
its first decline in over a year, which would temper fears of an imminent Fed
hike; fed funds futures price a 35% chance of a rate increase at this month’s
meeting. Last month’s meeting under new Fed chair Kevin Warsh took a relatively
hawkish tone; while that hawkish view may be optimistic, an upside CPI surprise
plus Warsh’s congressional appearances Tue‑Wed could still spark outsized market
volatility.
