Reply To: Traders Market Weekly: Rates, Debt and the Fed


Total CPI increased 0.5% month-over-month (consensus 0.5%) following last month’s upwardly revised 0.1% increase (from -0.1%) and core-CPI, which excludes food and energy, increased 0.4% month-over-month (consensus 0.4%) on top of last month’s upwardly revised 0.4% increase (from 0.3%).
The index for shelter accounted for nearly half of the monthly all items increase.

On a year-over-year basis, total CPI was up 6.4% — the smallest 12-month increase since the period ending October 2021 — and core-CPI was up 5.6% — the smallest 12-month increase since December 2021. Still, the year-over-year levels were not as low as expected.

The key takeaway from the report is that there has been a clear deceleration from peak inflation; however, the inflation rates are not nearly low enough to suggest the Fed would even be thinking about cutting rates this year.