CPI shows weakness😧
Core CPI came in at 0.157% MoM in June, weaker than consensus expectations at 0.3%, with YoY readings falling to 4.8% from 5.3% in May. Core goods prices 0.1% MoM, with a 0.5% decline in used car prices, while shelter prices also continued to slow, with primary rents and OER both missing expectations. The surprising weakness in core CPI was in core non-shelter services, which rose a mere 0.06% MoM, as well as a sharp 8.1% drop in airfares. Even against lowered expectations, the CPI print came in undoubtedly weaker, with Powell's preferred PCE measure showing a precipitous decline from 5.1% in Feb 2023 to 1.4% in June.
