CIBC Research discusses its reaction to today's US CPI report for the month of September.
"Headline inflationary pressures were weaker than expected in September, as hinted at by the PPI data that was released earlier in the week.
Flat monthly prices left annual headline inflation at 1.7%, unchanged from the prior month. Core inflation also remained steady at 2.4% with monthly core prices rising by 0.1%, also a tick below expectations. That's still a cycle high for core inflation, but given tamer readings seen on the regional Feds' more reliable trimmed-mean measures, there is limited upside for core prices ahead. There is little evidence of the tariffs on consumer goods that were in effect in September feeding through to prices, and we don't expect to see a large impact from those going forward either given that they are a relatively small share of the overall CPI basket, relative to services," CIBC notes.
"Little market reaction is expected, as market participants were likely expecting a softer reading following the PPI release," CIBC adds.