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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.
EXECUTIVE SUMMARY
- Core CPI inflation was stronger than expected in February at 0.36% M/M (cons 0.3).
- The details were generally a little softer: upside surprise was led by used cars and airfares, whilst core services were a little below expectations and we didn’t see persistence in OER’s January strength.
- Run rates are still troubling though, with six-month annualized rates rising 0.3pps to 3.9% for core and 5.9% for supercore. Notably, the six-month core CPI rate has pushed back above the Y/Y, whilst separate dispersion measures only saw limited moderation after January’s surge.
- Core PCE is likely to still be running notably softer than this, but the report doesn’t give the FOMC the “greater confidence” it’s looking for that inflation is moving sustainably toward 2%.
- Markets have moved further away from fully pricing a first cut in June (cumulative 18bp) and start to again look at three cuts in 2024 per the Dec SEP (latest 82bp) having briefly 100bps after Friday’s payrolls.
- Whilst not a major catalyst, the Feb CPI report has been a tipping point for some of the more dovish analysts in changing their Fed rate calls.
PLEASE FIND THE FULL REPORT BELOW:
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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