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Cleveland Fed CPI Nowcast Implies Upside Risk Again, But Take With Caution

US DATA
  • Heading towards Wednesday's CPI report for August, Bloomberg consensus puts core CPI at a median 0.2% M/M or an average 0.23% M/M.
  • The Cleveland Fed nowcast meanwhile pencils in core CPI at 0.38% M/M, but with the important caveat that it has seen large overshoots in the prior two months (averaging 0.26pps) after what had been a particularly accurate run before that.
  • Headline CPI is seen at very strong 0.79% M/M, also stronger than the median estimate of 0.6% M/M and average of 0.56% M/M.

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