Analyst: US inflation report drives early bond market rally, but details imply crisis

MetaEraSep 11, 2025
#Macro
On September 11 (UTC+8), institutional analysts stated that the bull steepening in the bond market after the CPI report was released was not surprising. We expect interest rates to eventually fall to 100 basis points as expectations for further rate cuts by the Federal Reserve heat up. Although the overall inflation data was in line with economists' expectations, some price pressures can be seen in the details. In addition to car repairs and air tickets, the prices of fruits and vegetables rose by 1.6% month-on-month, car fuel prices rose by 1.8%, and tobacco prices also rose by 1.0%. To be clear, the overall inflation data will not prevent the Federal Reserve from cutting interest rates, but it is clear that the report shows that there is indeed inflationary pressure in some areas of the economy. In addition, household food prices rose by 0.6% that month, the largest increase in nearly three years, and the United States is now a net food importer, so this category may have been greatly affected by tariffs. Within the grocery category, meat prices rose 2.7%, the largest increase in nearly four years, mainly driven by beef. [Jin10]
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Analyst: US inflation report drives early bond market rally, but details imply crisis

MetaEraSep 11, 2025
#Macro
On September 11 (UTC+8), institutional analysts stated that the bull steepening in the bond market after the CPI report was released was not surprising. We expect interest rates to eventually fall to 100 basis points as expectations for further rate cuts by the Federal Reserve heat up. Although the overall inflation data was in line with economists' expectations, some price pressures can be seen in the details. In addition to car repairs and air tickets, the prices of fruits and vegetables rose by 1.6% month-on-month, car fuel prices rose by 1.8%, and tobacco prices also rose by 1.0%. To be clear, the overall inflation data will not prevent the Federal Reserve from cutting interest rates, but it is clear that the report shows that there is indeed inflationary pressure in some areas of the economy. In addition, household food prices rose by 0.6% that month, the largest increase in nearly three years, and the United States is now a net food importer, so this category may have been greatly affected by tariffs. Within the grocery category, meat prices rose 2.7%, the largest increase in nearly four years, mainly driven by beef. [Jin10]
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