<h1>US Stocks Rise as Inflation Eases, Boosting Chances of Fed Rate Cut in September Meeting</h1> The US stock market rose toward record highs following a report showing inflation slightly lower than expected, prompting increased speculation that the Federal Reserve will cut interest rates at its September meeting. The inflation rate remained steady at 2.7% year-over-year in July, below economists' forecast of 2.8%, raising hopes for looser monetary policy to stimulate borrowing and investment. However, concerns persist about underlying inflation measures reaching their highest levels since early in the year, partly influenced by tariffs, which complicate the Fed's decision-making. Market participants now assign a 94% probability to a rate cut, up from 86% previously. The Fed awaits additional inflation and employment data before deciding. Internationally, other central banks have reduced rates, and recent US executive actions delayed tariffs on China, easing trade tensions. Despite strong corporate earnings in some sectors, market valuations remain high, increasing pressure on companies to sustain profit growth.