US unadjusted CPI-U likely posted a more modest gain in July

In response to ongoing requests from those involved in the US inflation-trading space, we continue to provide detailed estimates for the prior month's unadjusted CPI-U index, as well updated forecasts for the BLS' series through the end of 2016. 

Underlying consumer prices for goods and services tend to soften over the second half of the year. As a result, market participants should be prepared for significantly smaller percentage changes in the unadjusted CPI-U than that of the seasonally adjusted headline measure. 

"The unadjusted CPI-U edged just 0.1% higher to 238.844 in July, following a 0.9% advance over the April-June span. Looking ahead, a 1.2% rise to 237.544 is estimated over calendar 2015 and a further 2.3% increase to 243.122 in 2016", says Societe Generale.