First, trade on easing inflation, then watch the U.S.-Iran situation. July PPI weakened, giving the market a further boost. July PPI was generally soft and below expectations, showing that inflationary pressure on the production side continues to ease. The 'softness' in July PPI mainly reflects the cooling of commodities (especially energy), which is related to the earlier decline in energy prices from their highs and adjustments following the Iran-related shocks. Although the service sector is still growing, its momentum has weakened compared to previous months (growth rate slowed), and transportation and warehousing have notably weakened. Overall, the year-on-year rate quickly fell from above 5% to 4.7%, which is a positive signal. PPI, as the upstream of CPI, measures the prices received by producers, while CPI measures the prices paid by consumers. In theory, changes in production costs are transmitted downstream through the supply chain, wholesale, and retail channels. As an upstream indicator for CPI, this helps alleviate upward pressure on August CPI, especially in commodities and energy. For two consecutive months, PPI month-on-month has been close to zero or negative, combined with July CPI already showing signs of cooling, adding evidence to the continued easing of the inflation trajectory. Talked about it at noon today—weakening PPI is also a further boost and positive for the market. In the short term, it should be optimistic —trade a few days on reduced inflation pressure first, then see if there are any new developments in the U.S.-Iran standoff. Now, looking at a potential risk: the prolonged U.S.-Iran standoff. While it hasn’t escalated significantly, the Strait of Hormuz remains stubbornly closed. This post is sponsored by @bitget_zh: 'Bitget Buy U.S. Stocks: Instant entry, seamless trading.'