Bond investors are uncertain about Fed rate cuts in light of strong job figures, with a 70% chance of a cut in September. Inflation data this week will influence the Fed’s next move, with the June consumer price index report expected to show a 2.9% increase in core inflation. The Fed’s stance on tariffs is causing a divide among policymakers, leading to market uncertainty. Despite concerns about inflation, solid demand at recent Treasury auctions suggests buyers may limit any selloff. Economists anticipate a modest bear-flattener in Treasury yields if tariff pressure on consumer prices emerges.

Upcoming economic data includes the Empire manufacturing report, consumer price index, and retail sales. Fed officials are scheduled to speak throughout the week, with auctions for various Treasury bills also taking place. Market volatility is low, but uncertainty remains high in the bond market.

Read more at Yahoo Finance: Bond Traders Cast Doubt on September Fed Cut Before Key CPI Data