Chicago Fed President: The inflation path remains to be confirmed, and more data support is needed for a rate cut in September

According to the Zhitong Finance APP, Charles Evans, President of the Federal Reserve Bank of Chicago, stated that he would like to see at least one more inflation data report before being confident that persistent inflation pressures are no longer rising.

In an interview on Friday, Evans mentioned that recent inflation data has been "somewhat mixed," and he believes "at least one more data point is needed to determine whether we are still on the 'golden path.'"

He reiterated his concerns expressed earlier this week regarding the high service sector inflation shown in the July Consumer Price Index (CPI), but emphasized that one should not overreact to single-month data, including the import price increase data released on Friday.

So far this year, Federal Reserve officials have held rates steady to observe the impact of tariffs and other policy changes on the U.S. economy. According to pricing in the interest rate futures market, investors generally bet that the Federal Reserve will restart rate cuts at the September meeting. Evans emphasized the desire to wait for more economic data and pointed out that the U.S. economy "still has a lot of resilience."

"We will have to judge which price increases are temporary and can be ignored, and which require a response," Evans said. "If two of the next four inflation reports are like the first two this month, I would feel very reassured that inflation pressures are gradually dissipating."

Before his remarks, the latest data from the U.S. Department of Commerce showed that U.S. retail sales increased by 0.5% month-on-month in July, exceeding market expectations, and June data was revised up to a 0.9% increase. Excluding automobiles, retail sales grew by 0.3%.

Meanwhile, U.S. industrial output fell by 0.1% month-on-month in July, with manufacturing output, which accounts for three-quarters of the total, remaining unchanged after a revision in June, while mining and utility output both declined. Manufacturing had received a large number of orders before tariffs were implemented at the beginning of the year, but since then, production has weakened due to cooling demand, slowing capital expenditures, and uncertainty in trade policy. Producers also face challenges such as uneven consumer spending and tariffs pushing up prices for certain raw materials.

Regarding trade policy, U.S. President Trump stated on Friday while flying to Alaska to meet with Russian President Putin that he would impose tariffs on semiconductors within the next two weeks, marking the latest sign of his expanding tariff system. He said, "I will determine the tariffs on steel and chips next week and the week after... the rates could be 200% or even 300%." It is unclear whether he misspoke when referring to steel tariffs. In June of this year, the U.S. raised import tariffs on steel and aluminum to 50%. Additionally, Trump has repeatedly stated plans to impose tariffs on imported drugs and semiconductors, but has not formally announced them