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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 INFLATION
We've published our preview of the June CPI report out on Thursday July 11 (0830ET/1330UK) - PDF here.
- Consensus sees core CPI at 0.2% M/M in June after the softer than expected 0.16% M/M in May (vs cons 0.3), with a mild skew toward a “high” 0.2%, per MNI’s compilation of sell-side previews.
- But there is an unusually wide range of estimates for core this month. Uncertainty over some categories (eg auto insurance) means that a surprise reading in either direction should be interpreted with caution.
- That may prove especially true for the “supercore’ reading, which is expected to bounce from May’s slightly negative M/M print, to 0.27% (MNI sell-side average), but with a wide range of estimates.
- While sequential energy deflation is set to drag down overall price pressures to a lesser extent than in May, headline inflation at 0.08% M/M (MNI sell-side average) is nonetheless seen remaining below core.
- Core services inflation is seen picking up to around 0.3%, from 0.2% in May. Housing will again be a key focus – analysts’ expectations imply potential for the softest monthly readings since 2021 – but its disinflationary impact is expected to be outweighed by bounces in airfares and auto insurance prices.
- Meanwhile, the expected resumption of the downtrend in used car prices should see core goods prices providing a larger deflationary impulse, at around -0.1 to -0.2% M/M (vs -0.04% in May).
- A soft or even in-line June CPI report would give the FOMC more cover to hint at July’s meeting that a September cut is on the table, if the data remain cooperative after what Chair Powell called “some modest further progress” in recent readings.
- With market positioning already implying increasing comfort with a 2-cut scenario by end-year, though, the greatest risk going into Thursday lies with a hawkish release.
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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