Amid An Escalating Mideast Conflict, Investors Await U.S. CPI Figures and Chairman Warsh’s Testimony
July 14, 2026
The price of WTI crude oil reached as high as $81.27 overnight, it’s most elevated level in 7 weeks and up around 12% in just under two days. U.S. consumer price data from June due in less than a half hour are expected to reflect sharply lower energy costs that are now highly outdated. Investors hope to find Fed Chairman Warsh’s semi-annual Humphrey-Hawkins testimony more enlightening in understanding the ramifications for monetary policy in the second half of 2026. Possibly multiple rate increases could occur not just in the United States but elsewhere too, like at the European Central Bank and Bank of England.
Market Action Overnight: Oil has slipped back under $80 at the moment. The dollar, which had touched highs earlier today of JPY 162.48, $.1378/EUR, $1.3387 per pound, and CHF 0.8152 on safe-haven demand, now shows slight net losses. Ten-year sovereign debt yield overnight increases range from just a basis point in the United States to five bps in Australia and four bps each in the U.K. and Italy. The 10-year Japanese JGB yield, bucking that trend, has fallen back six basis points. Prices for Bitcoin, gold and silver have risen 0.7-0.8%. U.S. stock futures are slightly in the red despite a spectacular quarterly earnings report from JP Morgan Chase. Share prices closed up 1.4% in China and 0.7% in both Japan and South Korea, but major European bourses are showing losses ranging from 0.4% in Italy to 0.8% in Spain.
U.S. consumer price inflation slowed more sharply than forecast to a 3-month low of 3.5% overall last month from 4.2% in May and to 2.6% excluding food and energy from May’s 7-month high of 2.9%. Analysts had expected year-on-year increases of 3.8% and 2.8%, respectively, in June. A drop in the energy component’s year-on-year change to a 3-month low of 15.7% versus 23.5% in May was the major driver of the month’s disinflation. The food component edged down to 3.0% from 3.1%. Services dropped by 0.3 percentage points to 3.2% but has still not been below 3.0% since May 2021.
Federal Reserve Chairman Warsh’s testimony on the U.S. economy and monetary policy is set to begin today before the House Financial Services Committee at 10:00. This highly followed 2-day ritual since 1979, will be the first time for Warsh and as is the custom will be reprised before the Senate Banking Committee on Wednesday, also at 10:00 EDT.
Small business sentiment in the U.S. economy crested in December 2024 at 105.1, one month after the reelection of President Trump amid excitement around his promises to deregulate business, but such soured quickly. June’s reading of 97.4 represents a 4-month high following May’s 18-month low of 95.3. Unless the reescalation of the war against Iran quickly reverses, June’s spike is apt to prove a fleeting one.
Other data highlights this Tuesday include
- A downward revision to Japanese industrial production growth in May to 0.1% versus April and the biggest year-on-year drop (-2.1%) in the past twelve months. The original estimates were +0.5% on month and -1.7% on year. April/May output combines was 0.4% below the first quarter average in contrast to a 2.5% increase between 4Q 2025 and 1Q 2026.
- Japanese capacity usage also edged up 0.1% in May and posted a 2.6% year-on-year drop.
- Wholesale price inflation in India unexpectedly accelerated to a 45-month high of 9.87% in June in spite of a drop in the fuel component to 27.4% from 30.3%. Food price inflation jumped 1.65 percentage points to a 16-month high of 6.1%.
- German wholesale prices fell 0.7% on month in June after a 0.6% decline in May. That trimmed the 12-month rate of increase by a full percentage point to a 3-month low of 4.9%.
- Finnish consumer price inflation last month of 2.1% matched May’s 38-month high.
- In Singapore, real GDP grew 6.0% year-on-year in the first half of 2026, even exceeding the robust increases of 5.3% in 2024 and 5.0% in 2025.
- In Australia consumer sentiment in July rose to a 4-month high, but at 83.9 and averaging 81.8 during April-July, it remains much weaker than the first quarter average score of 91.7 or last November’s reading of 103.8.
- Business confidence in Australia improved much more sharply than expected in June to -5 from -14, but business conditions held steady at +3 from a third straight time.
- Same-store sales in Britain grew just 1.7% in the year to June, much less than forecast and halve of May’s 3.4% reading.
- The Irish construction purchasing managers index sank abruptly from a 9-month high in May of 50.2 to a 9-month low of 45.4 last month.
- Business confidence in Brazil‘s industrial sector fell to a 61-month low of 44.4 in July.
- Germany’s current account surplus of EUR 10.4 billion in May represents a one-year low, but the year-to-date surplus was only 1.4% narrower than the surplus during the first five months of 2025.
- China’s trade surplus spiked its second widest size in June ($125.6 billion versus $105.4 billion in May and January 2025 record of $137.9 billion). The first half surplus of $576 billion versus $586 billion a year earlier hardly seemed affected by U.S. trade policy changes.
Right after the opening bell on Wall Street, three of the four major U.S. stock market indices opened somewhat lower, the exception being a 0.4% rise of the Nasdaq. Oil’s price is hugging the $80 per barrel level, and gold is 2.1% above Monday’s close. The 10-year Treasury yield is now four basis points south of Monday’s closing level, and the dollar compared to yesterday’s closing levels is 0.6% weaker against the euro and down 0.3% relative to the yen.
Copyright 2026, Larry Greenberg. All rights reserved.
Tags: Chinese trade surplus, Indian and German wholesale prices, revision of Japanese industrial production, U.S. consumer prices in June 2026
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