1. U.S. Consumer Inflation Comes in Line — But the Story Isn’t Over
U.S. consumer inflation came in line with expectations on a month-over-month basis, while the year-over-year rate came in below expectations.
Here’s why this is interesting: everyone and their grandparents were expecting inflation to tick higher as tariffs start to take effect. But… isn’t it too early to see that impact? Time will tell.
On Thursday, we get the Producer Price Index (PPI) — inflation at the producer level. If PPI remains tame (it has shown almost no growth since February), it could mean consumer inflation won’t go off the rails anytime soon. This will be worth watching.
2. Gold’s Strange Sell-Off Ahead of CPI
Sunday night — during low-volume trading hours — gold started selling off. That selling continued throughout the day Monday.
Why does this matter? It happened right before CPI data and near all-time highs.
So, what’s going on?
Possibility 1: There’s a group of sellers looking to cash out — maybe some panic selling. Selling at low-volume times is odd.
Possibility 2: This is a head fake to shake out weak hands before a move higher.
Key levels to watch: $3,450 on the upside, and $3,300–$3,250 on the downside. A break in either direction could lead to fast, sharp moves.
3. Market Says “Nothing Matters” — For Now
Right now, the stock market is essentially saying:
Tariffs? Don’t matter.
Uncertainty around tariffs? Don’t matter.
Possible economic slowdown? Don’t matter.
Sky-high valuations? Don’t matter.
NVDA’s massive spending? Don’t matter.
Indices remain near all-time highs, and the VIX suggests fear is nowhere to be found.
But be careful — just because nothing has broken yet doesn’t mean it won’t. We’re heading into the seasonally volatile months for equities, and history says turbulence could be ahead.
4. September Rate Cut? Bonds Think So
Will the Federal Reserve cut rates in September? The bond market seems convinced it’s coming. Yields are cooling, and some are starting to ask: “Is it time to buy U.S. bonds?”
But here’s what I’m watching — global yields.
Japan’s yields are at levels not seen in decades.
The UK’s long end of the curve remains elevated, even after a rate cut.
Remember: yields have the power to break things.
5. USD, CAD, Bitcoin, and Canada’s Construction Freeze
The U.S. Dollar Index may have made another higher low — let’s see if it holds.
The Canadian dollar looks vulnerable. A drop below 0.716-ish could mean more selling.
Bitcoin is still struggling to break above $120K, but it’s off the early August lows. Maybe Trump’s 401K announcement is giving it some lift?
Canadian building permits fell month-over-month. And from what I hear, almost nobody is building in Canada right now. If you really want to know the state of the sector, talk to the people at both the start and the end of construction projects.