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July CPI was not dovish enough, which was the biggest impact on the market yesterday. CPI can only suppress the probability of a September rate hike but cannot completely reverse it, causing the financial markets overnight to start pricing in inflationary pressure again. The CME swap rate for a September rate hike probability rose from an extreme 36% yesterday to 40% now, still at a dangerous edge, so tonight we need to watch the PPI data. CPI data reflects inflation on the consumer side, while PPI reflects inflation's impact on businesses. Whether it can further suppress the probability of a September rate hike, this PPI data carries much more weight than before. The focus of tonight's PPI data is whether the nominal PPI and core PPI exceed the expected 0.2%. Best case: nominal PPI ≤ 0.1%, core PPI ≤ 0.2%, meaning both CPI and PPI cool down, further weakening the September rate hike and boosting risk markets. Moderate case: nominal 0.2%, core 0.3%, mild inflation, same as CPI, suppressing September rate hike and benefiting risk markets, but still not dovish enough. Worse case: nominal ≥ 0.3%, core 0.4%, business inflation is rebounding, increasing the probability of a September rate hike, suppressing risk markets. Worst case: nominal ≥ 0.4%, core ≥ 0.5%, divergence between consumer and business inflation, accelerating future inflation, overturning the optimistic July CPI expectations, increasing September rate hike expectations. #7月CPI平稳落地，9月加息预期降温