Free Trial

MNI US CPI Preview: Sizeable Upside Risk To Core CPI Consensus Of 0.3

EXECUTIVE SUMMARY

  • Consensus puts core CPI inflation at 0.3% M/M in April but with sizeable skew to the upside.
  • Used cars are again seen as one of the main upside drivers after failing to follow industry source prices higher in March, but with some partially offsetting factors elsewhere.
  • For core services, a slight re-acceleration in key rent measures is expected after last month’s surprisingly fast moderation, but non-housing price pressures are seen moderating after limited improvement in March.
  • The market currently sees last week’s 25bp hike to 5-5.25% as the last of the cycle and almost fully prices a reversal of that move just four months later in September, despite a reasonable push higher in Fed Funds implied rates after Friday’s payrolls. We see market reaction skewed larger in the event of a miss.

PLEASE FIND THE FULL REPORT HERE:

USCPIPrevMay2023.pdf

To read the full story

Close

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.