The July Consumer Price Index (CPI) indicated a 0.2% increase in consumer prices, stabilizing at 2.7% from June. Core CPI inflation rose to 3.1% with a 0.3% monthly increase. Despite this, the Producer Price Index (PPI) increased by 0.9%, above expectations. This suggests businesses are absorbing greater costs, potentially hinting at future price pressures. Despite a slight decrease in rate cut probabilities, confidence in Federal Reserve cuts in September remains high, benefiting real estate investment trusts (REITs) which may see growth from lower interest rates.
The latest Consumer Price Index (CPI) report has sparked optimism, revealing consumer prices rose 0.2% in July, meaning the index held steady from June at 2.7%. This was milder than anticipated, but core CPI inflation rose more - 0.3% - bringing the core rate up to 3.1%. While this could signal future price pressures, the CME Group's FedWatch tool indicates only a slight dip in rate cut expectations 92.5% versus 94.3% yesterday.
Lower interest rates typically benefit real estate investment trusts (REITs), which struggle under high borrowing costs due to their debt-heavy structures. As rate cuts loom, two REITs stand out as prime investment opportunities today.
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