[Preview] US June CPI, Further Slowdown Expected Are September Interest Rate Cuts Sure?

The U.S. Bureau of Labor StatisticsThursday, July 11th at 21:30 (Japan time)uponUS Consumer Price Index (CPI) for JuneIt is planned to be announced. According to Goldman Sachs, the consumer price index (CPI) for JuneShows signs of a further slowdown in inflationIt is expected, and combined with the recent unexpected rise in the US unemployment rate, there is a possibility that expectations for interest rate cuts by the US Federal Reserve in September will be further raised.

According to market forecasts,energy priceswithused car priceDue to the decline, the overall inflation rate will continue to slow in June. Specifically,Composite Consumer Price Index (CPI)Compared to the previous yearSlowed from 3.3% to 3.1%But compared to the previous monthIncreased from 0.0% to 0.1%It is expected that will happen. Excluding the volatile food and energy sectorCore CPIfell to 3.4% in May, which is the first low level in 3 years,There is no further progress this time, compared to the previous month0.2%, compared to the previous year3.4%It is expected to remain flat.

In addition to these key indicators, the Federal ReserveTrends in service inflationI'm also watching closely. In particular, the core index of service CPI excluding housing expenses has accelerated since the beginning of this year, and recorded 5% compared to the previous year in May. Before the Fed relaxes its cautious stance on inflation,It is ideal to see this indicator drop for at least 2 consecutive monthsI think so.

JP MorganDivide this week's US CPI into 6 scenarios、How the S&P 500 Stock Index respondsI predicted it. What is the CPI core index0.15 to 0.2% increase from the previous monthThat's what JPMorgan's trading desk saysPredictions that are viewed as the most powerfulthat's it. In this case, the S&P 500 is expected to rise by 0.5 to 1%.

US CPI last MayButBoth core indices fall short of market expectationsThe results were obtained.Total CPIIs3.3% increase from previous yearIt reached a low level for the first time in 3 months.The month-on-month ratio is flat、Low level since July 2022It became.Core CPIIsUp 3.4% year on year、Low level since April 2021It became.0.2% increase from previous month、Low level since 2023/10It became.

It was announced last weekUS employment statistics for JuneThe number of people employed in the non-farm sector itself exceeded expectations, but the comparison source's May figuresMajor downward revisionsIt has been done, and it's a delicate number.The unemployment rate worsened unexpectedlyTogether with that, it made people aware of the slowdown in the US job market.

Interactive Brokers Torres predicts that food prices, medical expenses, transportation expenses, and car insurance premiums will rise in June. Meanwhile,Energy prices (including gasoline and aviation fuel)withEnergy service prices (including electricity)Torres believes that the decline will be a mitigating factor. Also,New and used carsIt is predicted that the price of clothing will also drop.

Bank of America analystsDecline in new car pricesIt is anticipated that overall commodity prices will continue to fall due to the effects. They write that the inventory of new cars is increasing, so discounts and customer preferences by manufacturers are increasing. It also added that if transportation costs rise over the next few months, core commodity prices are likely to rise again.

According to JPMorgan's Tyler,The important point is whether housing costs are the reason for the decline in the inflation rateIt is.Housing costs have been the cause of deep-seated inflation until nowSo, if this falls significantly, it will be widely welcomed, and it is said that it will be viewed as a sign of further disinflation.

CPI housing prices (including rent and costs equivalent to owning a home) are one of the main factors behind the rise in the inflation rate. Analysts say the CPI for JuneExpect a slight decelerationDoing it.

Goldman Sachs analysts said Monday, “As the rent gap between new and existing tenants continues to shrink, we expect housing inflation to fall from last month's pace, and the rent inflation rate will drop to 0.36% and the homeownership rate to 0.39%.” Bank of America analysts said, “The cooling of rents and OER inflation over the next few months will strengthen the Fed's confidence in the inflation outlook.”

●Rents increased 0.4% from the previous month and decreased by 0.7% from the previous year　

According to Apartment List, the rental market is in the middle of a busy season,Rents haven't risen that much during the busy season this year. The national median rent rose for 5 consecutive months, but the pace of increase slowed slightly, and there was a 0.4% increase in June compared to a 0.6% increase from the previous month in May.The market continues to be sluggishIt shows.

From May to JuneGasoline retail prices have dropped drastically. According to the U.S. Energy Information Administration (EIA) survey, it is a drastic drop of 4% from 3.725 dollars per gallon in May to 3.576 dollars in June. Since gasoline prices rose slightly from May to June last year, it is expected to drop considerably on a year-on-year basis.

Used car wholesale prices in June fell compared to MayI did it. The Mannheim Used Car Price Index (MUVVI) was 196.1, down 8.9% from the same month last year. The impact was mitigated by seasonal adjustments, and it was negative for 2 consecutive months, down 0.6% from the previous month. Also, the average price before adjustment in June fell 2.2% from May, and fell 10.0% from the previous year.

However, even if the CPI indicators for June all fell,It may still not be enough for the Fed to cut interest rates. The inflation rate dropped drastically from its peak of 9.1% in '22. Nevertheless, the US Federal Reserve has stated that it is waiting until it is more certain that inflationary pressure is easing toward the target before moving on to interest rate cuts or monetary easing.

Federal Reserve Chairman Powell testified at the Senate Banking Committee on the 9th. I acknowledged that “moderate progress” has been seen in recent data,Further progress is neededIt also suggested that. “If more good data comes out, we will be able to strengthen our confidence that the inflation rate will continue to move towards 2%,” he said.

According to Chicago's FedWatch tool,The Federal Reserve cut interest rates for the first time in SeptemberWhat are the possibilities77.1%、Interest rate cuts will be implemented twice by the end of the yearIt is expected that will happen.