CPI remains the most important monthly economic metric
CPI remains the most important monthly economic metric: Tom Essaye Quoted in MorningStar
Dow turns higher as Apple falls ahead of its iPhone event, with inflation data looming
“CPI remains the most important monthly economic metric for the simple reason that if CPI does not continue to decline, markets will have to price in a more hawkish Fed, and that would be a headwind on stocks,” said Tom Essaye, founder and president of Sevens Report Research, in a note Tuesday.
“Sensitivity to this report will be especially high tomorrow because there have been anecdotal signs that inflation may be leveling off or bouncing back,” he said.
A “good” CPI report would show core inflation, which excludes energy and food prices, rose 0.2% or less in August, according to Essaye. Economists polled by the Wall Street Journal have forecast that core CPI increased 0.2% last month and 4.3% year over year.
“A continued drop in core CPI will help to calm concerns that inflation is bouncing back, and that could trigger a solid drop in Treasury yields and a good relief rally in stocks,” said Essaye.
Also, click here to view the full Morningstar article published on September 12th, 2023. However, to see Tom’s full comments on the current market environment sign up here.
If you want research that comes with no long term commitment, yet provides independent, value added, plain English analysis of complex macro topics, then begin your Sevens Report subscription today by clicking here.
To strengthen your market knowledge take a free trial of The Sevens Report.
Join hundreds of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.