Goldman Sachs: Expects July CPI to Be Slightly Below Expectations, but Oil Price Rebound Will Make Market Hard to Fully Relax

August 11th, the Goldman Sachs economic team expects that the month-on-month core CPI in July will rise by 0.19%, slightly below the market consensus of 0.2%; the year-on-year growth rate will be 2.47%, also lower than the consensus expectation of 2.5%. As for the nominal CPI, Goldman Sachs expects a month-on-month increase of only 0.05%, lower than the market expectation of 0.1%, mainly reflecting the impact of the previous decline in energy prices.

However, the inflation risk has not completely disappeared. Goldman Sachs stated that this forecast corresponds to a month-on-month increase of 0.26% in core PCE in July, with sub-items such as portfolio management possibly contributing significantly to the increase. Looking ahead to the next few months, the bank expects the monthly core CPI increase to be around 0.2%, housing inflation to continue to slow, the contribution of tariff-related price increases to decline, and the pressure from previous aviation fuel price increases on airfare prices to ease.

The U.S. July CPI will be released at 20:30 Beijing time on August 12th, and the market is awaiting this data to provide direction for U.S. bond yields and the rotation of tech stocks.

Prior to the CPI release, the 10-year U.S. Treasury yield has returned to around 4.70%, and oil prices have also risen back above $87. Goldman Sachs warns that if oil market disruptions and price increases persist longer than expected, the inflation risk will tilt to the upside.