US CPI due Friday – preview

Adam post a preview of the US inflation data due 11 January 2019 

Following up with some bank views on what to expect:


  • Gasoline prices at the pump sank about -10% sequentially in December, and much sharper than the seasonal norm. Accordingly, we look for a -0.2% drop in headline CPI on the month. Core prices should come in at a more typical 0.2% as demand remained robust – evidenced by an extremely healthy run rate in retail chain-store sales which printed north of 9% y/y at the end of December. These monthly prints would slow the y/y rate in headline CPI to 1.8% from 2.2% while leaving the core pace unchanged at 2.2%

Deutsche Bank

  • “While the December CPI report may not be a game changer for the market’s perception of near-term hiking prospects, a solid print in line with our expectation (core CPI +0.20% month-over-month and 2.2% year-over-year) should keep Fed rate hikes in play this year if various uncertainties are resolved” 

Trump has his hands full with the wall and shutdown but he’ll spare a moment to urge JP not to hike any more if the need should arise. 


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