Wall Street saw losses on Monday, coinciding with the first federal inflation report following President Trump’s dismissal of the head of the agency responsible for it.
The Dow Jones Industrial Average dropped by 201 points, marking a 0.5% decline.
Similarly, the S&P 500 Index and NASDAQ Composite each fell by 0.3%.
This dip came just a day ahead of the Bureau of Labor Statistics (BLS) set to release the latest Consumer Price Index (CPI) data.
Economists are predicting a 0.2% increase in prices for July, based on consensus estimates.
“Tomorrow’s data likely won’t show much acceleration from June, though service prices, particularly from airlines, might be on the rise,” some analysts suggest.
After securing victory in the 2024 election with promises to reduce prices, Trump is now facing voter dissatisfaction and concerns from fellow Republicans as his tariffs continue to apply pressure on inflation.
Wall Street will closely monitor the report and Trump’s reaction, especially after his volatile response to the July employment report.
The July federal employment data indicated that the U.S. gained just 73,000 jobs last month, following significant revisions to previous employment figures for May and June.
This brings the total job increase over the last three months to just over 100,000, which is about a third of what economists estimate is necessary to avoid rising unemployment.
Trump responded by accusing the BLS of manipulating employment statistics to favor Democrats, although he offered no supporting evidence for his claims.
Additionally, he dismissed former BLS commissioner Erica Mantelfer, which drew protests from Democrats and some Republican figures, raising concerns among economists.
Contrary to Trump’s assertions, revisions to employment and inflation figures are standard procedures for the BLS to ensure accurate data. The White House has not shown evidence of any political tampering, and experts argue it’s nearly impossible to skew employment reports in that manner.
“These numbers are compiled by hundreds of people following strict protocols. It’s unlikely that the head of the BLS could manipulate this data,” said former Treasury Secretary Larry Summers.
Concerns about the trustworthiness of U.S. employment and inflation statistics could significantly impact the country’s economic reputation and control.
“This issue poses a bigger risk than pressure on the Fed,” noted Jai Kedia from the Cato Institute. “Labor and inflation metrics are critical for all federal agencies addressing the economy.”
