- The US Consumer Price Index is projected to increase by 2.4% year-over-year in April, mirroring the growth rate observed in March.
- Core CPI inflation, a key metric excluding volatile food and energy prices, is anticipated to remain steady at 2.8% for the past month.
- The forthcoming April inflation data holds the potential to significantly influence the Federal Reserve’s policy outlook, thereby impacting the US Dollar’s valuation in global markets.
The highly anticipated Consumer Price Index (CPI) report for the United States, covering the month of April, is scheduled for release by the Bureau of Labor Statistics (BLS) on Tuesday at 12:30 GMT. Financial markets are keenly awaiting this release to gauge the current inflationary pressures within the US economy.
The CPI data is widely expected to exert a considerable influence on the performance of the US Dollar (USD) and will likely play a crucial role in shaping the Federal Reserve’s (Fed) future decisions regarding monetary policy and interest rate adjustments. Investors and economists alike will be scrutinizing the report for indications of whether inflation is moderating, accelerating, or remaining persistent.
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What are the expectations for the upcoming CPI data report?
Current forecasts suggest that the overall inflation rate in the US, as measured by the CPI, will show an annual increase of 2.4% in April, maintaining the same rate of increase as recorded in March. The core CPI inflation rate, which provides a clearer picture of underlying inflation trends by excluding the often-volatile food and energy sectors, is also projected to hold steady at 2.8% year-over-year (YoY) for the reporting period, matching the growth observed in the preceding month. These figures are crucial for understanding the sustained inflationary pressures within the economy.
On a month-over-month basis, both the headline CPI and the core CPI are expected to register an increase of 0.3% each. These monthly figures provide a more granular view of the immediate inflationary trends and are closely watched by analysts for any signs of acceleration or deceleration in price increases.
In a preview of the upcoming report, analysts at BBH (Brown Brothers Harriman) emphasized the importance of a specific inflation metric: “Keep an eye on super core (core services less housing), a key measure of underlying inflation. In March, super core inflation fell to a four-year low of 2.9% YoY vs. 3.8% in February. Higher tariffs can ultimately derail the disinflationary process.” This “super core” measure is considered a critical indicator of persistent inflationary pressures within the service sector, and its trend is closely monitored by the Fed. Furthermore, the analysts highlighted the potential risk that escalating trade tariffs could pose to the ongoing disinflationary trend, potentially disrupting the central bank’s efforts to bring inflation back to its target level of 2%.
