Wrightson ICAP Takes The "Under" On April Core CPI

Wrightson ICAP is toward the lower end of analysts' core CPI expectations, forecasting a 0.2% M/M reading today (vs 0.3% consensus, +0.1-0.5% low/high range).

• "In a close call... we expect the core index to round down to 0.2% for April, as many of the categories that posted outsized gains last month, such as hotel prices (+3.8%) and auto insurance (3.3%) seem likely to post less extreme increases this month."
• Unlike some forecasters, Wrightson ICAP is not expecting a surge in used vehicle prices: "One critical assumption in our forecast...is that the April increase in used car prices will not be much larger than March's gain of 0.5%. Much larger gains are likely in subsequent months, but we expect the CPI measure to ramp up more slowly than private industry data."