Inflation data due for the US today, previews
Via Daiwa:
- of significant interest to the markets
- core CPI is likely to benefit from above-potential economic growth to post a rise of 0.2%M/M in line with the recent trend, while the headline index might rise 0.3%M/M on the back of higher fuel and food prices too - as will be elements of Wednesday's PPI report for May.
Barclays:
- We look for May CPI to rise by 0.2% m/m and 2.8% y/y.
- The move higher in gasoline prices is one of the factors likely to contribute to the headline print.
- For core CPI, we expect an increase of 0.2% m/m and 2.2% y/y.
Nomura:
- After core CPI inflation slowed to 0.1% (0.098%) m-o-m in April, we expect only a modest rebound to 0.2% (0.158%) m-o-m in May, corresponding to 2.2% (2.198%) on a 12-month basis. Part of the softness in May core CPI inflation was likely owing to continued weakness in used vehicle prices and negative payback from an unusually large increase in April rent inflation. Higher jet fuel prices may have pushed up airline fares in April, posing some upside risk.
- However, we think that overall, core CPI likely increased at a trend-like pace in May, consistent with our view that inflation will accelerate only gradually. For non-core components, higher crude oil prices likely translated into higher retail gasoline prices while food prices likely increased at a steady pace of 0.2% m-o-m. Altogether, we expect headline CPI to increase by 0.3% m-o-m (0.259%), corresponding to 2.8% (2.834%) on a 12-month basis.
