By eFXdata — Jan 14 - 12:00 PM
Synopsis:
Morgan Stanley forecasts headline CPI for December to rise by 0.37%M, driven by energy prices, while core CPI is expected to slow to 0.26%M, reflecting easing pressures in core goods and stable rents.
Key Points:
-
Headline CPI:
- Energy prices likely contributed significantly to the expected 0.37%M increase.
-
Core CPI:
- Core CPI is forecast to increase by 0.26%M, slowing from recent monthly trends.
- Core goods inflation moderates, with less hurricane-driven car price pressure.
-
Rent and Housing Trends:
- Owners' equivalent rent and tenant rents expected to accelerate but remain below the past year’s pace.
- The final core CPI figure (0.26%M) rounds to 0.3%M but is on the edge of rounding to 0.2%M, with downside risks if rents or car insurance prices underperform expectations.
Conclusion:
Morgan Stanley expects slower core inflation for December, with risks leaning toward a softer core CPI print if certain components like rents or car insurance weaken further.
Source:
Morgan Stanley Research/Market Commentary