U.S. June CPI is coming today: Will it beat market expectations?
U.S. June Consumer Price Index (CPI) due 8:30 am EST on Wednesday has market participants' undivided attention, standing as the last potentially market-moving catalyst before second-quarter earnings season hits full stride.
What is the projection?
Economists polled by Reuters and Bloomberg expect the Consumer Price Index, which tracks the prices that urban consumers spend on a basket of goods, to have accelerated in June on both a monthly and annual basis, by 1.1% and 8.8%, respectively.
The acceleration is likely to reflect higher gasoline and elevated food costs. Prices at the nation's gas pumps reached a high of more than $5 a gallon in mid-June and will add at least 0.5 percentage point to the headline CPI monthly advance, according to Bloomberg Economics.
But the so-called "core" CPI, which excludes food and energy prices, is seen repeating May's 0.6% monthly increase and cooling down to 5.7% year-on-year.
What is the implication?
An easing of annual core CPI is likely the most crucial element of the report, as it could potentially convince the Federal Reserve not to become even more aggressive in its interest rate hikes. Fed officials have previously signaled a 75 basis-point interest-rate hike at their next meeting, but a lower inflation reading might change their stance.
What do economists think?
The White House expects June's consumer price index figures to be "highly elevated" as Americans grappled with substantial increases in the cost of gasoline and food, but also says the reading was "already out of date" because of falling energy prices.
$Citigroup (C.US)$ economist Andrew Hollenhorst shares similar opinions, as he believes inflation is "firmly entrenched" in a tight housing market. "We continue to expect a slowing in activity and some slowing in prices, but it could take time both to cool down the overheating housing market, and that may only flow through to rents with a lag," Hollenhorst said.
Tom Simons, a money market economist at $Jefferies Financial (JEF.US)$, believes June CPI will be a mixed number, but he remains positive on the potential market reactions. "If it comes in higher than expected, we'll feel this is definitely the peak," said Simons. "If it comes in lower, the markets will also be encouraged that the pace of inflation could slow. Either way, we're going to end up with some kind of relief rally."
So mooers, What do you think? What is your take on inflation? Leave your comments below:![]()
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Source: Bureau of Labor Statistics, Bloomberg, CNBC, Reuters
Disclaimer: The content should not be relied on as advice or recommendation.
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only.
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Giovanni Ayala :
Plan_B2 : Imo yes: very optimistic
Xero_3728 : no, it's going to be much worse
xXSavage_Red_PandaXx : I predict cpi is coming in hawt bewteen 8.8-9.0%
NIKKI Z : Maybe there's a reversal![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
dreamteam2022 : here we are as Americans paying these ridiculous prices for gas and food etc..... yet the president is over here backing up all these stupid laws and regulations all the while we as Americans are struggling more than ever just to get by. and Joe Biden is relaxing comfortable and half if not more than Americans are struggling and suffering from all this inflation yet we still can't receive another stimulus check
and there's all this money floating around yet there are still homelessness and hungry individuals still walking about. why won't our government help
三和巴菲特 : If oxy falls, buy a lot of money.
Matomic : i do believe we will see a relief rally no matter the data. getting close to bottom.
70860589 : let’s see
Chan Teddy : Didn't I tell you the cpi was higher this time? Why else would the US president go to Saudi Arabia?
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