Energy Shock Masks a Quiet Core
Headline CPI surged 0.9% m/m in March — well above the 0.7% consensus — after a modest 0.3% gain in February. On a yearly basis, total inflation accelerated to 3.3% from 2.4%.
Core CPI (ex food & energy) came in softer than expected at +0.2% m/m vs. 0.3% forecast, matching February's pace. Year-over-year core ticked up slightly to 2.6% from 2.5%.
...Of course Energy (Motor Fuel +21.2%)
The entire headline overshoot came from energy — the energy index jumped 10.9% in a single month, pushing its annual rate to 12.5%. Meanwhile, food prices were flat m/m (+2.7% y/y), and shelter rose a moderate 0.3% m/m (+3.0% y/y). Used cars continued to deflate (−0.4% m/m, −3.2% y/y), while apparel firmed (+1.0% m/m, +3.4% y/y). Services overall ran at +3.1% y/y.
Core inflation looked tame on the surface, but that calm may be temporary. The energy price shock hasn't fully filtered through yet. The risk is that pass-through effects push core readings higher in April — making this report less reassuring than the core number alone suggests.
Headline CPI surged 0.9% m/m in March — well above the 0.7% consensus — after a modest 0.3% gain in February. On a yearly basis, total inflation accelerated to 3.3% from 2.4%.
Core CPI (ex food & energy) came in softer than expected at +0.2% m/m vs. 0.3% forecast, matching February's pace. Year-over-year core ticked up slightly to 2.6% from 2.5%.
...Of course Energy (Motor Fuel +21.2%)
The entire headline overshoot came from energy — the energy index jumped 10.9% in a single month, pushing its annual rate to 12.5%. Meanwhile, food prices were flat m/m (+2.7% y/y), and shelter rose a moderate 0.3% m/m (+3.0% y/y). Used cars continued to deflate (−0.4% m/m, −3.2% y/y), while apparel firmed (+1.0% m/m, +3.4% y/y). Services overall ran at +3.1% y/y.
Core inflation looked tame on the surface, but that calm may be temporary. The energy price shock hasn't fully filtered through yet. The risk is that pass-through effects push core readings higher in April — making this report less reassuring than the core number alone suggests.
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Invest wisely – earn independently. Trade Market Neutral. tradingneutral.com
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.