US CPI Preview: Banks expecting headline inflation to lift by 0.1% in January

Today, we have an all-important release of US CPI for the month of January, which is likely to attract most attention by markets.

Most of the economists and researchers are expecting the US consumer prices to likely rise by 0.1% m/m in January, while the core consumer price index (CPI) is likely to rise by 0.2%.

Morgan Stanley

“Morgan Stanley expects the US core consumer price index (CPI) to rise 0.2 percent in January, in line with its three-month average, but sees the headline CPI falling for the fourth consecutive month to 1.5 percent from 1.9 percent.” 

“The data due at 13:30 GMT is expected to show the cost of living ticked 0.1 percent month-on-month in January, following a 0.1 percent drop in December.”

TD Securities

“We expect headline CPI to retreat to 1.5% thanks to lower gasoline prices," said TD Securities previewing this week's inflation report from the U.S.”

“Outside of fuels, however, we see strength across food and core services. The latter should underpin a 0.2% m/m print on core CPI, translating to a 2.1% y/y increase vs 2.2% previously.”

“Looking ahead, we anticipate headline CPI will likely remain in a narrow 1.4-1.6% range, with a break toward 2% unlikely before Q4 at the earliest.”

Danske Bank

“US CPI for January is due out this afternoon. We estimate CPI core rose +0.2% m/m in January, implying a core inflation rate at 2.1% y/y down from 2.2% in December.”

Rabobank

“The data highlight is US CPI though, where consensus is 0.1% m/m and 0.2% core, keeping core CPI over 2.0% y/y.”

National Bank Financial

According to analysts at National Bank Financial, the release of the consumer price index for January will attract the most attention as far as US markets are concerned.

“Headline prices could have increased only modestly in the month with gasoline again acting as a drag. This, combined with a negative base effect, may lead to a four-tick decline of the year-on-year rate to 1.5%. The annual core inflation rate, meanwhile, could have increased 0.2% in January, allowing the 12-month figure to decline one tick to 2.1%.”