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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 OUTLOOK/OPINION
- Core non-housing service inflation meanwhile looks to roughly be expected to firm to a still containable 0.2% M/M in July after the far softer than expected -0.05% M/M in June saw a second consecutive month of deflation. Whilst explicit estimates are limited, they see a typical range from 0.10% to 0.33% M/M.
- The drivers will once again be watched closely, especially as airfares are again expected to play a large role in monthly volatility (on average seen -1.7% after -5.0%) and of course with the PCE-relevant component already known as PPI lands ahead of CPI this month.
- A 0.2% print would see “supercore” CPI inflation slow to just 0.4% annualized over three months whilst the six-month would ease from 4.8% to 3.4% annualized for its slowest since October.
- There is still a large gap with the PCE supercore equivalent though, tracking an average 0.18% M/M in May and June, with the three-month at 2.6% and six-month at 4.1% annualized.
- That gap aside, that particularly low supercore CPI three-month trend rate and a swiftly moderating six-month rate would help remove what is now seen as only a tail risk that would prevent the FOMC from cutting in September.
- However, current 25bp or 50bp cut discussions for the Sept 18 decision could well come down to the composition of any surprises here and the likelihood of them being sustained in the subsequent August release on Sep 12.
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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