The RBS Strategist team supports its forecast pointing that "the headline has been dragged down by a slide in the energy index in the second quarter, but energy prices may have risen by 0.8% in July, as seasonally adjusted gasoline prices could have inched up by 1%."
"The slowing in economic growth in the first half of the year may begin to put
some downward pressure on cyclically-sensitive prices (e.g. hotel rates, new and used cars)," continued RBS. "In any case, the headline CPI may have eased further in July, perhaps falling to 1.6%."
"Meanwhile, the core PPI may have cooled to 2.1%," concluded the bank.