Shoppers at the new H Mart during their grand opening in Westminster, CA, on Thursday, August 7, 2025.
Jeff Gritchen | Medianews Group | Getty Images
It was a stellar day for markets as all three major U.S. stock indexes closed at record highs on Wednesday.
That’s despite a sharper-than-expected month-on-month growth in U.S. consumer prices in August, according to the Labor Department, signaling that tariffs are likely raising inflationary heat.
While the monthly inflation reading overshot estimates from a Dow Jones survey by 0.1 percentage point, the headline annual reading, as well as both monthly and yearly core data, came in as expected.
Granted, that’s not much of a comfort. Having expectations of an unpleasant scenario confirmed doesn’t take away its sting.
That said, the inflation data was accompanied by a separate report that showed weekly jobless claims in the U.S. rose to their highest level in nearly four years.
“Today’s CPI report has been trumped by the jobless claims report,” wrote Seema Shah, chief global strategist at Principal Asset Management.
This reinforces the narrative that the U.S. Federal Reserve will lower rates by at least 25 basis points during its meeting next week.
But with so much riding on the Fed, it’s crucial to not just celebrate a possible rate cut next week, but also chew on what Chair Jerome Powell has to say about the economy and monetary policy.
What you need to know today
And finally…
U.S. President Donald Trump and President of the European Commission Ursula von der Leyen shake hands as they announce a US-EU trade deal after a meeting at Trump Turnberry golf club on July 27, 2025 in Turnberry, Scotland.
Andrew Harnik | Getty Images News | Getty Images
Trump’s pressure on Europe to slap 100% tariffs on India and China raises eyebrows
Reports that U.S. President Donald Trump asked the European Union to slap tariffs of up to 100% on China and India for their Russian oil purchases have raised eyebrows on both sides of the Atlantic.
The EU is unlikely to acquiesce, analysts say. Not only would the bloc be wary of adopting Trump’s contentious tariffs strategy and burning its own bridges with India and China, the EU’s complicated trading relationship with Russia also makes taking such a step quite unlikely.
— Holly Ellyatt
