SoSoMacro

Trump Says No Plans to Fire Powell; U.S. June PPI Misses Expectations; Fed Releases Beige Book; Trade Talks Remain in Focus.

Market Performance:

U.S. stocks broadly rose: the Dow gained 0.53%, the Nasdaq added 0.25%, and the S&P 500 climbed 0.32%.
Chinese ADRs were mixed, while Hong Kong equities advanced.
Markets in Europe, Japan, and South Korea declined, and emerging markets showed a mixed performance.

Here’s today’s SoSoMacro Recap — spotlighting the key signals driving markets at this moment:

1. Trump Walks Back Powell Threat After Market Turmoil: U.S. media reported that former President Donald Trump intends to fire Fed Chair Jerome Powell, sparking a sharp selloff across equities, bonds, and the dollar. Trump later clarified he has no immediate plans to remove Powell, calming investor nerves.

2. June PPI Misses Expectations: Producer prices in June came in significantly below estimates, though prior readings were revised higher. The decline was largely driven by weaker services prices. Data suggests businesses are still absorbing tariff-related costs rather than passing them on to consumers. The report is unlikely to shift expectations for a Fed rate cut in September.

3. Fed’s Beige Book: Slight Economic Pickup, Tepid Inflation Mentions: The July Beige Book noted a modest increase in economic activity, an upgrade from the previous description of "slight decline." The overall outlook was categorized as “neutral to slightly pessimistic.” Employment rose modestly, while inflation edged up at a moderate pace. Notably, mentions of inflation in the report fell to a four-year low.

4. Trade Tensions in Focus: Trump announced plans to notify over 150 countries of new tariff measures, aiming to impose reciprocal tariffs on imports from nations currently benefiting from lower U.S. duties.