The Fed’s preferred inflation gauge, core PCE Price Index, proved higher than consensus at persistently high levels in April. The markets recognized the report showed a combination of a robust 0.5% increase in real spending and the uptick in the year-over-year rates for the PCE Price Index and core-PCE Price Index. That combination will give the Fed some pause about pausing its rate hikes in June. The personal consumption expenditure price index (Core PCE prices) in the US, which exclude … Continue reading “Robust Increase in Real Spending with Core PCE Inflation at Persistently High Levels in April”
US Producer Price Inflation Moderates Again in April, +2.3% versus +2.7% in March
U.S. producer inflation continued to moderate in April with April PPI on a year-over-year basis, total PPI was up 2.3% versus up 2.7% in March. Excluding food and energy, PPI was up 3.2% versus 3.4% in March. PPI rose 0.2% month-over-month in April (consensus +0.3%) following an upwardly revised -0.4% decline (from -0.5%) in March. The index for final demand (Core PPI), excluding food and energy, increased 0.2% month-over-month in April (consensus +0.3%) following an upwardly revised unchanged reading (from … Continue reading “US Producer Price Inflation Moderates Again in April, +2.3% versus +2.7% in March”
Consumer Inflation in April Eases with Fed Screws Tightening, Core CPI Stays Elevated
Annual inflation cooled for the ninth straight month on a year-over-year basis, total CPI was up 4.9%, its lowest level since April 2021, just below last months, and expected 5 per cent. However, core-CPI only dipped slightly to 5.5% year on year, barely moving since the end of last year. On a monthly basis, the headline CPI index rose 0.4 per cent, versus a 0.1% gain in March. April’s increase was driven by housing costs and gasoline prices. core-CPI, which … Continue reading “Consumer Inflation in April Eases with Fed Screws Tightening, Core CPI Stays Elevated”
US Core PCE Inflation Held Steady at Persistently High Levels in March
The Fed’s preferred inflation gauge, core PCE Price Index, held steady at persistently high levels in March. The personal consumption expenditure price index (Core PCE prices) in the US, which exclude food and energy, rose by 0.3% versus 0.3% expected. The annual rate, the Federal Reserve’s preferred gauge of inflation came in at 4.6% year-over-year versus 4.7% in February. The markets recognized that the Fed will be more confident that hiking 25 bps at the last FOMC was correct and … Continue reading “US Core PCE Inflation Held Steady at Persistently High Levels in March”
Germany Inflation Continued to Ease in April, However Energy Prices Did Rebound
Germany’s consumer price inflation eased further to 7.2 percent year-on-year in April 2023, down from 7.4 percent the month before and slightly below market expectations of 7.3 percent. Well down from 8.7% just two months ago. The rate hit its lowest level since August 2022, but remained well above the ECB’s target of 2.0 percent. Energy inflation accelerated bounced to 6.8 percent from 3.5 percent in the previous period but it still down sharply from 19.1 percent in February. However, … Continue reading “Germany Inflation Continued to Ease in April, However Energy Prices Did Rebound”
US Producer Price Inflation Fell Again in March, -0.5% m/m vs 0.0% Expected
US Producer price inflation for March (PPI) declined 0.5% month-over-month in March (consensus +0.1%) following an upwardly revised 0.0% reading (from -0.1%) in February. Excluding food and energy (core), the PPI index for final demand declined 0.1% month-over-month (consensus +0.2%) following an upwardly revised 0.2% increase (from 0.0%) in February. On a year-over-year basis, the PPI index for final demand was up 2.7% versus 4.9% in February, Core PPI was up 3.4% versus 4.8% in February year over year. The … Continue reading “US Producer Price Inflation Fell Again in March, -0.5% m/m vs 0.0% Expected”
Consumer Inflation in March Eases, Higher Shelter Prices Offsetting Fall in Energy Costs
Annual inflation cooled for the eighth straight month on a year-over-year basis, total CPI was up 5.0%, versus up 6.0% in February. That is the smallest 12-month increase since May 2021. However, core-CPI was up 5.6% year-over-year, versus up 5.5% in February. Higher shelter prices (0.6%) offsetting a 3.5% fall in energy cost. Food prices were unchanged. The report showed disinflation, but that trend doesn’t necessarily take a rate hike at the May FOMC meeting off the table with core-CPI … Continue reading “Consumer Inflation in March Eases, Higher Shelter Prices Offsetting Fall in Energy Costs”
FAO World Food Price Index Fell in March for Twelfth Consecutive Month
World food prices as measured by the FAO Food Price Index continued to fall, down for a 12th month to 126.9 points in March 2023, the lowest level since July 2021, and down 20.5% from the record hit in March 2022 after Russia invaded Ukraine. Sugar prices again were the anomaly, up 1.5% hitting its highest level since October 2016 amid concerns over lower global availabilities for both food and as a biofuel component. Meat prices rose 0.8%, namely bovine … Continue reading “FAO World Food Price Index Fell in March for Twelfth Consecutive Month”
Reserve Bank of India Surprised Keeping its Key Repo Rate at 6.50%
The Reserve Bank of India on Wednesday surprised by keeping its key repo rate at 6.50% during its April meeting. Guidance however was hawkish as Governor Shaktikanta Das said “our job is not yet finished and the war against inflation has to continue” but markets nevertheless drove a bull steepener across the Indian rates curve. The Reserve Bank of India Monetary Policy Committee (MPC) decision followed a 25-bps hike in February, bringing the rate to level not seen since March … Continue reading “Reserve Bank of India Surprised Keeping its Key Repo Rate at 6.50%”
Asian Development Bank says Upside risks to China’s Growth Outlook Outweigh Downside Risks
The Asian Development Bank (ADB) on Tuesdays raised its growth forecast for developing Asia. Growth in developing Asia is forecast at 4.8% this year and in 2024, up from 4.2% last year. The People’s Republic of China’s (PRC) recovery and healthy domestic demand in India will be the region’s main growth supports this year and next. The ADB sees the upside risks to China’s growth outlook outweighing downside risks. ADB forecasts 5% economic growth for China in 2023, up from … Continue reading “Asian Development Bank says Upside risks to China’s Growth Outlook Outweigh Downside Risks”