The latest US inflation print for July shows a beat towards the downside and a signal that inflationary pressures are continuing to ease. Headline inflation came in at 3.2% and core at 4.7% beating estimates of 3.3% and 4.8% respectively. Whilst inflation remains above the Federal Reserve’s 2% target the latest figures support calls for a pause in rates. Markets had priced in another 0.25% increase in the Fed Funds rate; however, markets are now lowering the odds of a further hike this year. Meanwhile weekly jobless claims rose to 248,000, which topped estimates and illustrates the view that the US labour market is beginning to weaken. Labour market resilience has been the biggest driver of core inflation year-to-date. Markets reacted favourably, with the S&P 500 and Nasdaq 100 opening higher at 1.3% and 1.7% respectively.