Inflation held steady in July and ran slightly cooler than expected, increasing the odds of a Federal Reserve rate cut next month.

San Francisco Federal Reserve Bank President Mary Daly, in an interview following economic reports showing stronger-than-expected retail sales and an unexpected jump in wholesale prices last month, signaled that she is still on board for beginning to ease policy as soon as next month.

Futures markets are also expecting a rate cut. Investors peg the chances of a quarter-point interest rate cut at nearly 96%, according to the CME FedWatch Tool, a measure of market sentiment.