Analysts at Nomura note that the US headline CPI inflation was up a modest 0.129% m-o-m in June, below expectations (Nomura: 0.212%, Consensus: 0.2%).
“On a 12-month basis, headline CPI inflation registered 2.872% y-o-y, broadly in line with expectations and up 0.1pp from 2.801% y-o-y in May. The downside surprise in headline CPI was due to softer-than-expected gain in food prices (+0.176%) and an unexpected decline in energy services prices which include electricity and gas (-1.464%).”
“On a 12-month basis, core CPI inflation came in at 2.255% y-o-y, matching expectations. The components of core CPI suggest that the underlying pace of core inflation remains steady.”
“Based on June CPI and PPI data, we forecast a modest 0.060% m-o-m increase in core PCE prices in June. If realized, the 12-month change rate of core PCE prices would slow to +1.881% in June from +1.995% in May.”
“We continue to see a gradual pickup in core PCE inflation on a 12-month change basis over the medium term. We expect core PCE inflation to reach 2.1% y-o-y by end-2018, 2.2% by end-2019, and 2.4% by end-2020.”
“Core CPI data suggest a steady pace of underlying inflation Overall, solid readings in persistent components of core CPI suggest that the underlying trend of core inflation remains unchanged.”
“Core PCE inflation forecast Based on June CPI and PPI data, we forecast a modest 0.060% m-o-m increase in core PCE prices in June.”
“We expect core PCE inflation to reach 2.1% y-o-y by end-2018, 2.2% by end-2019, and 2.4% by end-2020.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Follow us on Telegram
Stay updated of all the news
AUD/USD oscillates at around 0.6680s after FOMC’s decision, ahead of US jobless claims
The AUD/USD finished Wednesday’s session in the green, gaining 0.26%, though well below the day’s highs at 0.6758. As the Asian Pacific session begins, the AUD/USD trades at 0.6683, slightly below its opening price by 0.01%.
EUR/USD steadies near seven-week high around 1.0850 after post Fed whipsaw
EUR/USD bulls take a breather close to a two-month high, following a five-day uptrend, after Federal Reserve’s (Fed) failure to please US Dollar bulls despite announcing a 0.25% rate hike. The Euro pair seesaws around 1.0860, after a brief run-up to 1.0912, as the latest greenback licked its wounds during the last hour.
Gold soars to $1,978 after Fed raises rates as expected Premium
Spot gold jumped to $1,978 during Fed Chair Powell’s press conference and then pulled back. A decline in US yields and broad-based Dollar weakness is offering support to the yellow metal, which is up more than 1% on the day.
TRON price crashes 12% as SEC charged founder Justin Sun for violating securities laws
TRON price plummeted on March 22 after the cryptocurrency became the new target of the ongoing regulatory crackdown in the United States. The Security and Exchange Commission (SEC) is now looking into Tron founder Justin Sun’s company and related entities of the altcoin’s ecosystem.
Fed review: A cautious 25bp hike
The Fed's decision to hike rates by 25bp was widely anticipated by both the markets and economists ahead of the meeting. In line with our expectations, Fed made no changes to its QT, and the median 'dot' continued to signal Fed Funds Rate at 5.00-5.25% through 2023.