Inflation continued to moderate in July as both top-line and core inflation increased 0.2%; top-line inflation increased 2.9% from one year ago and core inflation advanced 3.2%. The internals of the report released by the Bureau of Labor Statistics on Wednesday tend to suggest that there will be further ... READ MORE >
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PCE inflation continues to ease in June as income and spending gain
The Federal Reserve’s preferred measure of inflation continued to ease in June, reaffirming that the central bank has achieved enough price stability to reduce its policy rate at its September meeting, which has been our baseline forecast for a number of months. Top-line inflation in the personal ... READ MORE >
Bank of Canada reduces rate to 4.5 per cent amid disinflation
There was little surprise in the Bank of Canada’s announcement on Wednesday when the central bank reduced its policy rate by 25 basis points to 4.5 per cent. The tone of the central bank's statement was notably dovish and marked a departure from a hawkish or cautionary tone that persisted over the past ... READ MORE >
Canada’s CPI in June shows disinflation and suggests rate cut
June’s inflation report in Canada confirms that the economy is on a disinflationary trajectory as headline inflation dropped to 2.7% because of slower growth in gasoline prices. On a monthly basis, the consumer price index fell by 0.1% after a 0.6% increase in May. On a seasonally adjusted monthly ... READ MORE >
Producer prices rise 0.2%, but signs still point to lower inflation in Fed’s key gauge
Despite the producer price index coming in stronger than expected on Friday, the Federal Reserve's most important measure of inflation, the personal consumption expenditures index, should remain near zero in June when it is released on July 26. Read more of RSM's insights on inflation, the economy and ... READ MORE >
Further disinflation in the June consumer price index points to a Fed rate cut
Disinflation in energy and core goods has been the underlying inflation narrative over the past 18 months, and that continued to be the case in the consumer price index for June. Declines in gasoline prices, used cars and trucks, transportation and commodities caused a 0.1% decline in the top-line CPI ... READ MORE >
Fed’s key inflation gauge continues to cool in May as income increases by 0.5%
The Federal Reserve’s preferred measure of inflation continued to ease in May as the personal consumption expenditures Index remained unchanged on the month and rose by 2.6% from a year ago. The core PCE index, which excludes the more volatile food and energy components, advanced by 0.1% and increased ... READ MORE >
Canada’s inflation rises to 2.9% but rate cut remains on the table
Disinflation will be the theme in the Canadian economy for the rest of the year, despite the inflation uptick in May. Inflation rose to 2.9 per cent on a year-over-year basis in May, with a 0.6 per cent monthly increase, Statistics Canada reported on Tuesday. Core inflation measures also rose slightly ... READ MORE >
U.S. harmonized index of consumer prices: A more accurate metric of disinflation?
Part of a central bank’s challenge in setting its policy rate lies in knowing which measure of inflation to follow. From the consumer price index to the personal consumption expenditures index, different measures of inflation can tell a different story. On Friday, investors and policymakers will ... READ MORE >
U.S. inflation expectations are well anchored as Fed nears decision
American inflation expectations remain remarkably well anchored given the price shock of the past two and a half years. Our preferred measure of inflation expectations—the Federal Reserve’s five-year forward, five-year breakeven rate and the five-year forward breakeven index—imply that professional ... READ MORE >