Credit Suisse And JP Morgan Nudging Above Consensus On Core CPI

Credit Suisse expects core CPI to reaccelerate in October to 0.4% M/M, which with rounding is enough to push the Y/Y up to 4.4% or 0.1pp above consensus, and with further upside risks.

• They note "around half of the expected increase should come from price gains in used vehicles", with further support from "continued steady increases in rent and OER".
• "Travel-related services prices are likely to be mixed, with a decline in hotel rates and moderate gains elsewhere."
• A strong rise in gasoline and natural gas prices sees headline CPI at 0.6% M/M, pushing annual inflation up from 5.4% to 5.9% Y/Y.

• They see core CPI up 0.4% M/M in October (0.38%) and 4.4% Y/Y, also with a sizeable boost from rental inflation (both imputed and otherwise) and used cars.
• Strong increases in various energy-related products plus still solid food price inflation sees their headline CPI forecast at 0.7% M/M and 6.0% Y/Y.