CPI

A soft landing consensus for CPI? The forecasting consensus is sticking close to its November predictions, with a 0.3% increase expected for core CPI (falling from 6% to 5.7% year-over-year) and -0.1% for headline CPI (falling from 7.1% to 6.5% year-over-year) for December. A print

Market rents are decelerating, which means CPI-measured rents – and with them, core and headline CPI – should ultimately decelerate as well, with a lag. But is this deceleration due to the Fed’s actions? Or is it because job growth is slowing down endogenously, as many have been expecting over this

Not out of the woods yet on upside risks to monthly core CPI inflation: The forecasting consensus has shifted down from its 0.5% expectation for core CPI in October to a more optimistic 0.3% expectation in November. This seems to be mostly a reaction to the welcome core

Headline CPI: Modest upside risk vs. forecasting consensus * Consensus: 0.6% month-over-month, 7.9% year-over-year * Gasoline prices did not play a major role in October, with only a minor non-seasonally-adjusted increase from September to October at the retail level. * Energy services inflation should be more moderate given the correction in

September headline CPI inflation will likely come in near the consensus forecast of 0.2% as gyrations in commodity markets slow. In our view, upside risks weigh more heavily to the non-core components of inflation relative to consensus because of how the ‘Russia shock’ affects a number of food and

August headline CPI inflation will likely come in close to the consensus forecast at -0.1% – which would be the lowest single-month reading since the onset of the pandemic.

When we disaggregate the aggregate inflation statistics, we find that the sources of high inflation in the US and Europe are different.

July headline inflation is likely to come in roughly in line with the consensus forecast at 0.2% with the possibility of a mild downside surprise. Core inflation will likely be in line with forecasts as well at 0.5%, and is poised to cool further in coming months.

Two things are all but guaranteed for the rest of the week: 1. The Fed is going to hike 75 basis points (2.25%-2.50%) and signal that it remains vigilant about inflation. Their characterization of growth dynamics are likely to remain on the rosier side, and inflation expectations