Dollar & Bond Yields Tumble As Core CPI Disappoints, Rent Inflation At 10-Year Lows
US Consumer Prices were expected to rise for the 8th straight month in January and it did rising 0.3% MoM as expected, leaving year-over-year prices rising at 1.4%…
However Core CPI missed expectations, unchanged in January compared to an expected 0.2% MoM rise.
Used Car prices and Food-at-home saw MoM declines as Energy costs and Apparel saw the biggest rises…
Used car price acceleration appears to have peaked…
And on the bright side for many, shelter/rent inflation continues to slow (despite record high prices?)
Rent inflation Y/Y dropped from 1.84% in Dec to 1.62% in Jan, lowest since August 2011
Shelter inflation Y/Y dropped from 2.28% in Dec to 2.05% in Jan, also lowest since August 2011
So the NY rental collapse is why the Fed will keep inflating the biggest asset bubble for years?
The reaction in bonds was instant, with 10Y Yields dropping 2bps…
And the dollar is taking a dive…
However, we note that inflation indices are one to two months away from a dramatic rise due to basing effects from the pandemic lockdowns…
Will The Fed shrug them off as transitory?
Wed, 02/10/2021 – 08:36