Hawks are hiding – the Consumer Price Index is edging lower, and it means lower chance of new rate hikes from the Federal Reserve (Fed). Markets like it. The figure that makes headlines beyond financial media is headline inflation, which surprised to the downside with a rise of 4.9% vs. 5% expected.
The US Bureau of Labor Statistics (BLS) reported on Wednesday that inflation in the US, as measured by the change in the Consumer Price Index (CPI), declined to 4.9% on a yearly basis in April from 5% in March. This reading came in slightly below the market expectation of 5%.
The beginning of the end of rate hikes – or the beginning of the countdown toward slashing borrowing costs? That seems to be the message from markets, which are rushing forward to price the next moves of the Fed.
The US Bureau of Labor Statistics reported on Wednesday that inflation in the United States, as measured by the Consumer Price Index (CPI), declined to 5% on a yearly basis in March from 6% in February.
A semi-Lehman moment? That seems to be the fear in financial markets in recent days, with a sliver lining – a lower path of interest rates. Yet if Silicon Valley Bank's spectacular failure is contained, then the good news for the economy melts that silver lining. The fresh inflation gives the Federal Reserve a fresh reason to raise interest rates.
The US Bureau of Labor Statistics reported on Tuesday that inflation in the United States, as measured by the Consumer Price Index (CPI), declined to 6% on a yearly basis in February from 6.4% in January. This reading came in line with the market expectation. On a monthly basis, the CPI was up 0.4%, matching analysts' estimate.
Is that it? Some investors surely have these thoughts, as they brush aside minor beats on yearly inflation figures – while they see the trend as remaining to the downside. That implies a risk-on mood in markets.
The US Bureau of Labor Statistics reported on Tuesday that inflation in the United States, as measured by the Consumer Price Index (CPI), declined to 6.4% on a yearly basis in January from 6.5% in December. This reading came in higher than the market expectation of 6.2%.
The Consumer Price Index released by the US Bureau of Labor Statistcs is a measure of price movements by the comparison between the retail prices of a representative shopping basket of goods and services. The purchase power of USD is dragged down by inflation. The CPI is a key indicator to measure inflation and changes in purchasing trends. Generally speaking, a high reading is seen as positive (or bullish) for the USD, while a low reading is seen as negative (or Bearish).
The US Federal Reserve has a dual mandate of maintaining price stability and maximum employment. According to such mandate, inflation should be at around 2% YoY and has become the weakest pillar of the central bank’s directive ever since the world suffered a pandemic, which extends to these days. Price pressures keep rising amid supply-chain issues and bottlenecks, with the Consumer Price Index (CPI) hanging at multi-decade highs. The Fed has already taken measures to tame inflation and is expected to maintain an aggressive stance in the foreseeable future.
