Three separate data sets this week point at the same underlying story: after a hot spring, nearly every part of the market is normalizing at once, prices, wholesale values, even consumer mood. None of it is alarming on its own. Together, it's the clearest read yet on where the back half of the year is headed.
📊 By the Numbers
📉 Overall wholesale market: down 0.48% last week (Black Book)
📉 Manheim Used Vehicle Value Index: down 0.6% in first-half July, still 📈 up 2% year-over-year
📉 CPI: down 0.4% in June, first decline since last summer
📈 Auto-related retail sales: up 5.7% year-over-year, strongest in a year
📈 Used EV wholesale values: up 12% year-over-year, vs. just 📈 1.7% for non-EVs
Everything's moving in a direction. The question is which direction actually matters heading into Q3.
Wholesale Is Cooling, But Not Falling Apart
Black Book's overall market fell 0.48% last week, essentially matching the prior week's pace.
📉 Where It's Falling Fastest
Full-size pickups: down for 11 straight weeks, last week's -0.74% the steepest since mid-December
Compact cars: depreciation accelerated to -0.72%, up from -0.23% the week before
📈 One bright spot: Full-size luxury crossovers/SUVs, depreciation slowed sharply to -0.24% from -1.06%
Manheim's read backs up the same story from a different angle. Its index fell 0.6% in the first half of July, still 2% above where it sat a year ago.
This isn't a market breaking down. It's a market correcting back toward a normal seasonal pattern after an unusually strong spring.
Inflation Actually Eased. The Fed Isn't Fully Buying It Yet.
June's CPI fell 0.4% month-over-month, a bigger drop than forecasters expected.
What's Driving the Relief, and What Isn't
📉 Overall energy costs: down 5.7% for the month
📉 Gas prices specifically: down 9.7% seasonally adjusted
📈 Unadjusted gas prices: still up 27% year-over-year, the relief is recent, not structural
Two things complicate the good news. First, that 27% figure means this is a recent dip, not a reversed trend. Second, Fed funds futures now assign a 49% probability of a rate hike by September, up from 44% a month ago, meaning markets aren't fully convinced this easing holds.
Consumers Are Feeling Better. Depending on Who's Asking.
📈 The University of Michigan's preliminary July reading jumped to its highest level since February, up nearly 10% from June.
📉 Morning Consult's daily tracker, capturing more recent conditions after renewed U.S.-Iran strikes resumed, shows sentiment down 0.7% for the month instead.
Two surveys, two moods, both correct at the same time. That's not a contradiction, it's just how fast things are moving right now.
The Two Numbers Worth a Closer Look
📈 Auto Retail Is Having a Genuinely Strong Year
Auto-related retail sales: up 1.9% in June alone
Up 5.7% year-over-year, the strongest annual gain in a year
This, even as overall retail sales barely moved
📈 Used EVs Are Pulling Away From the Rest of the Market
Used EV wholesale values: up 12% year-over-year
Non-EV wholesale values: up just 1.7% in the same period
Driven by wider availability and gas prices still elevated well above last year, even after the recent dip
