Retailers Face Inflation Headwinds as Fed Minutes Loom

Wall Street is set for a week of significant financial updates as some of the nation's biggest retailers report their earnings. Home Depot will release its latest results on Tuesday, followed by Target and Lowe's on Wednesday, and then Walmart on Thursday.

The earnings reports from these retail giants are expected to provide insight into how businesses and consumers are handling high inflation rates, which remain above 3%. The ongoing US war with Iran has contributed to a surge in oil prices, leading to higher gasoline costs and increased prices for goods that rely on shipping. As a result, people may shift or cut spending.

The Federal Reserve's interest rate policy will also come under scrutiny this week as the central bank releases minutes from its July meeting on Wednesday. The Fed held its interest rate steady in July amid concerns about inflation, the jobs market, and economic direction, but three officials dissented in favor of higher rates during the meeting.

Fed Chair Kevin Warsh described the policy discussion as a 'good family fight', implying that the decision was not without debate. Wall Street expects at least one rate hike before the end of 2026.