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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
US DATA
The CPI report for April is certain to scramble analyst forecasts for 2021 inflation. As we await this week's sell-side reviews for any forecast amendments, a thought experiment: even if each M/M CPI print is 0.0% in every month between now and the end of the year, we still won't have another headline Y/Y print below 2.0% in 2021 (see chart).
Source: BLS, MNI Calculations
- While of course this is just a stylized scenario - perhaps we will get negative M/M readings as some of the extreme subcategory outliers in recent months reverse - it illustrates the extent to which base effects are crucial, and how much the April shocker bumped up the baseline. And if we get another strong month or two in May and June, the impact is only amplified.
- If CPI in April had seen the expected 0.2% M/M increase instead of the 0.8% actual, for example, then a 0.0% straight-line forecast would have brought headline Y/Y below 2.0% as soon as September 2021 (vs Jan 2022).
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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