CPI: Well Behaved, Fed Will Ease Next Week
CPI: Well Behaved, Fed Will Ease Next Week
CPI was +3.0% year-over-year, both headline and core inflation number.
The government shutdown delayed this September report, but here we are just days before the next Fed meeting and the administration pushed to get the CPI number released so that the Fed would have this important data point to be better informed when making important decisions with respect to monetary policy -> well done!
Although inflation is firm at 3.0%, the Fed will find this number tolerable and will most likely ease next week.
On the housing front, positive news for Owners’ Equivalent Rent (OER), which represents 26% of CPI-weighting, it rose only 13 bps last month, the slowest pace since November 2020.
The biggest uptick was Energy prices which rose 1.5% for the month. The cost of energy will be a critical issue as the U.S. has entered the age of AI. Nuclear power is the cleanest, most reliable and largest potential generator for power, which is now fully recognized, however, it will take some time to build the plants that are necessary to power the next phase of the information/compute age.
Markets stable.
Good news for inflation is good news for credit markets. |
