CPI data is out, interest rate cut expectations may change? Look here!

Hey, friends, the latest CPI data is here! Although the monthly changes in the headline CPI and core CPI are in line with expectations, their actual index levels are slightly lower. As a result, the annual reading of the headline CPI has dropped from the expected 3.0% to 2.9%, which is the lowest level since March 2021!

Speaking of inflation, housing inflation rose slightly again this month, from 0.2% in June to 0.4%. However, overall super core service inflation (that is, core services excluding housing) only rose by 0.21% this month, which is quite mild, but still higher than the slight declines in May and June.

Overall, these data show that inflation levels have been slowing down in the past few years, but price growth has not stopped suddenly. So, it seems unlikely that the interest rate will be cut by 50 basis points next month. This is why short-term bond yields will rise!

Well, today’s CPI data is interpreted here! Friends, what do you think? Come and chat in the comment section! 💬💰