Easing inflation pressures provide the Federal Reserve with policy flexibility, though officials remain cautious about declaring victory

"Despite moderating inflation, strong domestic activity across consumption and business investment will keep the Fed diligent about the risks overheating could have on the inflation trajectory. We continue to expect the Fed to be patient as it awaits more inflation data."

"Concerns also eased after the first drop in consumer price inflation data in six years with the June CPI coming in at a negative 0.4% month-on-month. Fed Chair Kevin Warsh in his testimony to the Congress where he said that while some people may believe all is well after this inflation report, he does not think so."