AdvertisementThe most recent CPI reading, for June, showed headline inflation cooling to 3.5% year-over-year, down from 4.2% in May. What the inflation number could mean for marketsIf July’s inflation figure comes in below June’s 3.5% pace, it would likely take significant pressure off the Fed’s more hawkish members. Geopolitical tensions involving the US and Iran have kept energy markets volatile, and oil feeds directly into both headline inflation and consumer sentiment. It tells markets that the current rate hold is not a consensus view, but a majority position that could shift with one or two bad inflation prints. But the Fed’s own framework anchors around 2%, which means inflation is still running at nearly double the target.