US: Key Events Ahead - Nomura

Analysts at Nomura enlist key macro data scheduled for release from the US docket later today.

Key Events:

CPI: We expect headline CPI to increase by 0.4% (0.374%) m-o-m (2.3% y-o-y) in January, led by higher energy prices (Consensus: 0.3% m-o-m, 2.4% y-o-y) . Retail gasoline prices and futures prices suggest a pick-up in energy prices, but we expect food price inflation to have remained subdued. Excluding food and energy prices, our forecast for core CPI is a trend-like increase of 0.2% (0.157%) m-o-m or 2.1% y-o-y (Consensus: 0.2% m-o-m, 2.1% y-o-y). The lingering impact of the past appreciation of the US dollar suggests that core goods prices contributed little to core inflation.

Retail sales: Retail sales were weaker than expected in December, up only 0.6% m-o-m in December. We expect core (“control”) retail sales to have increased by 0.4% m-o-m in January (Consensus: 0.3%) as suggested by a healthy gain in core retail trade payroll and an elevated reading in the business activity index of the ISM nonmanufacturing survey. Thus, we forecast a 0.7% m-o-m increase in retail sales ex-autos (Consensus: 0.4%). With autos, we forecast a 0.1% m-o-m increase in retail sales (Consensus: 0.1%).

Industrial production: In December, IP registered a 0.8% m-o-m increase. However, incoming data suggest that industrial output likely declined in January. We expect a strong drag from the utility sector as temperatures in January were warmer than the historical norm. Altogether, we forecast a decrease of 0.5% m-o-m in January in total industrial output (Consensus: 0.0%).