Life Investments. Lauren good morning. Good to see you.>> Good morning Frank. Great to be here. >> All right.We're going to talk a lot more about the integrity of this data for CPI or questions about it at least coming up later in the show. But first the number itself. What do you think this means for the market. >> There's a couple of things that this data means for the market.The first is to acknowledge that 0.3% month on month inflation doesn't sound like a big difference from 0.2% month on month, but if ...

Inflation Trends & CPI Analysis - The Consumer Price Index (CPI) increased by 03% month-over-month, aligning with estimates, while core CPI (excluding food and energy) rose by 02%, slightly below expectations [1] - Year-over-year, consumer inflation increased by 27%, and core inflation rose by 29% [1][2] - Inflation is heating up slightly compared to the previous month, where both headline and core inflation increased by only 01% [2] - Core CPI has been consistently lower than estimated for the fifth consecutive month [3] Tariff Impact & Business Strategies - Initial data suggests that tariff increases are contributing less than a third to the monthly CPI increase, with some pressure emerging in categories first exposed to tariffs [7] - Businesses are employing various strategies, including inventory management, alternative sourcing, cost spreading, and margin adjustments, to buffer the impact of tariffs and avoid passing costs directly to consumers [9] - Apparel prices rose by 04%, footwear increased by 07%, and furniture/furnishings prices also saw a rise [8][31] - The effective tariff rate in June was only 10%, while the average tariff rate was around 15%, indicating that the full impact of tariffs has yet to materialize [14] Federal Reserve & Monetary Policy - The Federal Reserve faces a challenging decision regarding interest rate cuts, amidst pressure from the White House and the need to maintain its 2% inflation target [4][17] - The current federal funds rate is considered moderately restrictive, putting downward pressure on demand [18] - There is a risk that prolonged elevated inflation could become ingrained in people's expectations, potentially settling around 3% [20] - The Fed is closely monitoring core services inflation, which has been stubbornly slow to decline, to ensure momentum towards the 2% target [21][25] - The FOMC is divided on future rate cuts, with varying opinions on the number of cuts in 2025 [29] Specific Price Changes - Beef prices saw a significant increase of 2%, while egg prices decreased by 74% [32][33] - New vehicle prices dropped by 03%, and used cars/trucks decreased by 07% [34] - Shelter costs moderated, increasing by 02% compared to May's 03% rise [35] - The energy index rose by 09% in June, with the gas index increasing by 1% [36]