12:30 PM · 13 September 2023

BREAKING: Slightly higher US inflation reading does not impress the markets!

USA - inflation report for August:

  • CPI headline annual: Actual: 3.7% y/y. Expected 3.6% y/y; previously 3.2% y/y
  • CPI headline monthly: Actual: 0.6% y/y. Expected 0.6% m/m; previously 0.2% m/m
  • Core CPI annual: Actual: 4.3% y/y. Expected 4.3% y/y; previously 4.7% y/y
  • Core CPI monthly: Actual: 0.3% y/y. Expected 0.2% m/m; previously 0.2% m/m

 

Shelter +0.3% versus +0.4% last month. Year on year 7.3% versus 7.7% last month

Services less rent and shelter +0.5% m/m vs +0.2% prior

Gasoline contributed to more than 50% gain in the US CPI in August

Source: Bloomberg Finance L.P.

In general, initial moves in the dollar, stocks and yields have erased. That confirms the view that most participants had been positioned for a hot reading.  The implied rate for November shows exactly the same number as before the latest CPI numbers hit (implying a roughly ~38% chance of a 25 bps hike).

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