I noticed just a few statements after the CPI numbers got here out this morning and I am fairly certain they had been written final evening. Virtually like Mad Libs with the numbers stuffed in. All feedback point out that inflation numbers are nonetheless excessive.
Nonetheless, after I spoke to Gisela Hoxha, Citi’s U.S. economist, she sounded upbeat in regards to the numbers. Particularly, core inflation was a lot softer than anticipated.
Hoxha famous that as inflation started to say no final 12 months, disinflation was primarily seen in items costs, whereas companies continued to stay excessive.
That modified a bit with in the present day’s numbers, with among the stickier service elements of the CPI slowing. “This pattern has really proven that some elements of companies have been softer, equivalent to auto insurance coverage, private companies,” Hoxha stated.
Whereas the housing index stays robust — up 0.4% on the month, once more — these softer numbers might increase Fed Chairman Jerome Powell’s temper at in the present day’s press convention after the Federal Open Market Committee assembly.
Hoxha additionally famous that we anticipate further knowledge, together with labor market numbers, to be launched earlier than the Fed’s subsequent assembly in late July. Citi predicts that the Fed will lower rates of interest thrice this 12 months, in September, November and December. However there’s undoubtedly an opportunity in July, she stated.
We’ll maintain you posted as we converse to extra specialists.