CIBC Research discusses its reaction to today's US CPI report for the month of April.
"Slowly but surely, inflation is heating up. US consumer prices advanced 0.2% in April, leaving the annual rate accelerating a tick to 2.5%. That said, after stripping out the boost from both food and energy, prices were only up 0.1% on the back of soft readings on auto prices.
...This does further tilt the odds in favour of two more rate hikes this year rather than the three some Fed officials have been suggesting.
The slightly below consensus readings should be bullish for fixed income and bearish for the dollar," CIBC argues.