US: Further signs of disinflation appeared in April – UOB
Senior Economist at UOB Group Alvin Liew comments on the latest US inflation figures released on May 10.
Key Takeaways
“US headline consumer price index (CPI) increased by 0.4% m/m, 4.9% y/y in Apr (from 0.1% m/m, 5.0% y/y in Mar), the lowest headline reading, and the first below 5% inflation print since Apr 2021 (4.2%). However, core CPI (which excludes food and energy) proved to be stickier, as it rose sequentially at 0.4% m/m, (same as Mar), and compared to one year ago, it eased slightly to 5.5% y/y in Apr (from 5.6% in Mar).”
“US Inflation Outlook – For 2023, we still expect both headline and core inflation to ease to an average of 3.0%, and above the Fed’s 2% objective. Even as the shelter costs rose at a slower pace and food prices stayed flat for two months in a row, the latest CPI data showed that the balance of risk for US inflation remains far from being one-sided disinflation as reflected by surprise return of goods inflation and higher gasoline prices. Core and services inflation remain elevated (y/y) and rising (m/m), while the re-acceleration in Apr wage growth may still add to services cost pressure.”
Author
Pablo Piovano
FXStreet
Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.
