Consumer Price Index (CPI) data for July came in line with expectations, solidifying the likelihood of a Federal Reserve rate cut in September. In light of this development, José Torres, Interactive Brokers senior economist, joins Market Domination to share his perspective on inflation and the broader economic outlook.

Torres describes the CPI report as "overall a pretty good report," noting that gasoline and transportation segments were lower than he anticipated. However, he cautions, "We're stuck here in the 3% inflation range." Torres highlights persistent strength in shelter inflation, warning that if this trend continues, "we could have some unfavorable inflation dynamics moving forward."

Regarding potential Federal Reserve rate cuts, Torres told Yahoo Finance, "I think we are not going to see the amount of cuts that the market is pricing in, I think they're way too aggressive on the way down. I think it's going to be similar to what we're seeing from the ECB. Let's cut once, let's see what happens and let's see... how things evolve."

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This post was written by Angel Smith