Core non-housing service inflation is expected to see at least a repeat of the 0.21% M/M from July, with six analysts between 0.20-0.35% M/M.
This CPI “supercore” happened to be exactly in line with its PCE counterpart in July (also 0.21% M/M prior to typical monthly revisions) although that is rare. CPI supercore was far weaker before that, averaging -0.05% through May-June vs 0.145% M/M for PCE supercore but as the chart shows there is no typical spread between the two on a M/M basis.
The extent to which surprises are driven by CPI-specific items will again help shape market reaction here (with potentially offsetting factors from a sequential boost expected from airfares and a drag from vehicle insurance). PPI reverts to its more typical post-CPI release.
Nevertheless, expect sensitivity to a return of particularly soft supercore CPI readings, after just 0.5% annualized in the three-months to July.
The lowest analyst estimate of 0.2% M/M for August would see 1.4% annualized for the three-month whilst the six-month would continue its swift moderation with 2.8% after 3.4%, matching last year’s low of 2.8% in Aug’23 having accelerated to a high of 6.5% in Apr’24 in the interim.
US OUTLOOK/OPINION: Supercore CPI Seen At Least Repeating July’s Pace
Last updated at:Sep-10 19:18By: Chris Harrison
US
Core non-housing service inflation is expected to see at least a repeat of the 0.21% M/M from July, with six analysts between 0.20-0.35% M/M.
This CPI “supercore” happened to be exactly in line with its PCE counterpart in July (also 0.21% M/M prior to typical monthly revisions) although that is rare. CPI supercore was far weaker before that, averaging -0.05% through May-June vs 0.145% M/M for PCE supercore but as the chart shows there is no typical spread between the two on a M/M basis.
The extent to which surprises are driven by CPI-specific items will again help shape market reaction here (with potentially offsetting factors from a sequential boost expected from airfares and a drag from vehicle insurance). PPI reverts to its more typical post-CPI release.
Nevertheless, expect sensitivity to a return of particularly soft supercore CPI readings, after just 0.5% annualized in the three-months to July.
The lowest analyst estimate of 0.2% M/M for August would see 1.4% annualized for the three-month whilst the six-month would continue its swift moderation with 2.8% after 3.4%, matching last year’s low of 2.8% in Aug’23 having accelerated to a high of 6.5% in Apr’24 in the interim.
