If the next CPI report (following August 21, 2025) shows inflation not rising, and the next PPI report is as expected or lower, the Federal Reserve will cut interest rates at its subsequent meeting (mid-September 2025) to boost the struggling labor market.
"But if it shows that it's still not rising and then PPI comes in as expected or lower than what is expected, then again, they have no reason to not want to cut, especially with no more concern for the inflation aspect and more of a concern of, hey, labor market is still struggling. Let's boost it up. Let's start cutting rates."