Recent July CPI data at 3.4% year-over-year, down from 3.5% in June and in line with consensus, anchors trader expectations for the August annual rate. Cleveland Fed nowcasts as of August 12 project 3.36%, reflecting continued moderation in energy and shelter components alongside stable food prices. Lingering tariff pass-through and labor market tightness introduce upside risks, while base effects and subdued wage growth support a contained outcome. With market-implied odds showing 3.4% at 37.5% and 3.3% at 28.5%, the tight distribution underscores uncertainty ahead of the September 11 release, as fresh monthly prints and Fed communications could shift consensus on the path toward the 2% target.