Weekly Review 8-15-25

Last week, markets had a choppy but ultimately positive week. The S&P 500 stumbled on Monday despite news that the White House had extended the China tariff deadline by another 90 days¹. That weakness didn’t last long. By Tuesday, a softer-than-expected consumer price report reignited optimism that the Fed may finally be getting closer to cutting rates (bea.gov). Stocks took off, with both the S&P 500 and NASDAQ hitting fresh all-time highs (FactSet). Even so, some of that enthusiasm faded toward the end of the week when a hot inflation report showed business costs climbing faster than expected (bea.gov). When all was said and done, the S&P 500 still ended the week up 1%, pushing its year-to-date gain to 10% (FactSet).

The two inflation reports told very different stories. On the consumer side, prices for everyday goods and services held steady at a 2.7% annual rate in July, right about where economists expected. Rising shelter and service costs were balanced out by cheaper gas and stable food prices, giving households a bit of breathing room. But the wholesale side looked less encouraging. Business input costs jumped 3.3%, the sharpest rise in five months (bea.gov). To me, that looks like the first signs that companies are running out of tariff-cushioned inventories and now have to replace goods at higher prices. If that’s the case, those cost increases may eventually filter down to consumers. This leaves the Fed in a tricky spot: one report says inflation is steady, the other says pressures are building. Futures markets are still betting on a rate cut in September², with the possibility of more later this year, but last week’s data may give policymakers pause.

Looking ahead, the Fed will once again be front and center. On Wednesday, the minutes from the July 29–30 meeting will be released, which should give us a clearer sense of how divided policymakers really were over holding rates steady. Then on Friday, Fed Chair Jerome Powell will take the stage in Jackson Hole at the annual economic symposium, always a moment markets watch closely for hints of what comes next.

Enjoy your week,

Jeremy Raffer, MBA
Director & Wealth Manager
Author “Financial Planning for Widows”

m. 201-747-2705
w. rafferwealthmanagement.com
e. [email protected]

Steward Partners
115 W. Century Rd, Suite 145
Paramus, NJ 07652

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1 https://www.reuters.com/world/china/us-china-extend-tariff-truce-by-90-days-staving-off-surge-duties-2025-08-12/

2 https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html

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