Treasury Secretary Scott Bessent said there is a high possibility the Federal Reserve will cut interest rates by a larger-than-usual 0.5 percentage point next month. Bessent said the Fed could have lowered rates at its last two meetings,

Key Takeaways A relatively tame inflation report Tuesday boosted investors' hopes that the Federal Reserve will lower interest rates in September.Fed officials have kept rates high out of concern that President Donald Trump's wide-ranging tariffs will ignite inflation.

Inflation is slowly rising, but not surging out of control. That should provide some flexibility for Fed officials to cut interest rates in September if the job market continues to weaken. “Overall, inflation remains well-behaved,