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MNI US Inflation Insight: Some Signs Of Stalling Progress

Overall there appeared to be relatively little if any disinflationary progress in October's CPI and PPI data.
USGlobalInflation InsightMarketsStoryRegionNorth America

Executive Summary

  • The first major readings of October inflation brought largely in-line results, with sequential core CPI coming in a little lower than expected, and headline CPI and core PPI a little higher than expected.
  • To the degree that there were surprises, they largely reflected volatile components, or categories that the Fed is likely to look through as it attempts to discern the signal from the month-to-month data (namely, an uptick in housing inflation).
  • Overall there appeared to be relatively little if any disinflationary progress. This perception is likely to be exacerbated by a small sequential acceleration in the core PCE reading for the month.
  • While that’s unlikely to be a major impediment to a December Fed cut, a lack of additional “confidence” that inflation is headed sustainably to 2% will keep the FOMC wary of signaling aggressive further cuts in 2025.
     

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Executive Summary

  • The first major readings of October inflation brought largely in-line results, with sequential core CPI coming in a little lower than expected, and headline CPI and core PPI a little higher than expected.
  • To the degree that there were surprises, they largely reflected volatile components, or categories that the Fed is likely to look through as it attempts to discern the signal from the month-to-month data (namely, an uptick in housing inflation).
  • Overall there appeared to be relatively little if any disinflationary progress. This perception is likely to be exacerbated by a small sequential acceleration in the core PCE reading for the month.
  • While that’s unlikely to be a major impediment to a December Fed cut, a lack of additional “confidence” that inflation is headed sustainably to 2% will keep the FOMC wary of signaling aggressive further cuts in 2025.
     

PLEASE FIND THE FULL REPORT HERE:

Keep reading...Show less