Group 1 - The core viewpoint is that the US July CPI data aligns with expectations, showing a year-on-year increase of 2.7% in the overall Consumer Price Index (CPI) and a 3.1% increase in core CPI, which eases concerns about inflation due to President Trump's tariff policies [1] - The Federal Reserve's Chairman Powell indicated a reasonable wait-and-see approach, and the mild inflation data, along with weak employment data from the previous month, supports the rationale for easing monetary policy [1] - The market anticipates two rate cuts by the Federal Reserve before the end of the year, each by 25 basis points [1] Group 2 - Despite expectations for rate cuts to lower long-term US Treasury yields, the yield curve has steepened since the July CPI data release, indicating a decline in short-term yields and an increase in long-term yields [1] - Concerns about the independence of the Federal Reserve have arisen following Trump's criticism and recent personnel changes at the Bureau of Labor Statistics (BLS), which could disrupt market confidence in long-term US Treasury securities [2] - Historical precedents show that if the Federal Reserve's rate cuts are less than the market's current pricing expectations, long-term yields may rise, as seen when the 10-year Treasury yield increased from approximately 3.7% to 4.6% despite a smaller-than-expected rate cut last year [2]