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.
April's upside inflation surprise is unlikely to be repeated in May, at least on a month-on-month basis. But U.S. CPI is set to grow 0.4% following a 0.8% gain in April, according to Bloomberg. From a year earlier, CPI is forecast to increase 4.7% - the fastest since 2008 (and up from 4.2% in April).
- Prices for categories like airfare and hotel stays, hit hard by pandemic shutdowns, are expected to have continued increasing during the re-opening. Goods prices are also set to increase, driven by supply chain disruptions and materials and worker shortages.
Ex-food and energy prices will be watched even more keenly. Bloomberg survey median for core is +0.5%, average 0.46%.The sell-side high estimate is 0.7%; the low is 0.2% (see chart), with a standard deviation of 0.16% - so in theory, a slight miss shouldn't be too much of a surprise. Though a print on the higher end would get Y/Y to core above 3.0% for the first time since the mid-1990s.
- The dispersion in forecasts for the core elements is explained by analysts' varying expectations for both macro and micro factors, with those on the low end (e.g. Scotiabank) seeing more limited passthrough of prices to consumers than we saw in April; those on the upside (e.g. TD) see continued surges in key individual categories such as travel prices.
BBG Core CPI % M/M Forecast DistributionSource: Bloomberg Survey
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.