10yr-2yr spread continues to rise, 5 year inflation breakeven (unadjusted) shrinks, as does implied 2 month interest rate 1 month forward.
Category Archives: inflation
Inflation and Energy Prices
It’s belaboring the obvious that gasoline (and energy prices) had a big impact on headline inflation [BLS release]. M/m inflation was at Bloomberg consensus of 1.2%, while core was below, at 0.3% vs. consensus 0.5%. However, it’s useful to see how over time exactly how much headline and core diverged.
Gasoline Prices – Looking Forward
Nowcasts for tomorrow’s CPI print is 1.1% m/m (Cleveland Fed), and Bloomberg consensus is 1.2%. In contrast, core CPI nowcast is 0.52%, consensus at 0.5%. The large gap is in large part attributable to gasoline prices, which rose 20% in March (all grades), even though the CPI weight of gasoline is only 3.8%. What do gasoline prices look like in April? This will depend on oil prices.
Russia Drops the Policy Rate – What Does It Mean?
The ruble has stabilized at near pre-invasion levels, and the Central Bank of Russia drops the policy rate to 17%. What’s going on?
Inflation Expectations and Forecasts
Market expectations for inflation over next five years as of today:
Inflation since 1960
Figure 1: Headline CPI inflation, year-on-year (blue), and Core (brown), both in %. NBER defined recession dates peak-to-trough shaded gray. Source: BLS, NBER.
Guest Contribution: “Rising Inflation, Narrowing Policy Space”
Today we are pleased to present a guest contribution written by Justin-Damien Guénette (Senior Economist), Jongrim Ha (Senior Economist), M. Ayhan Kose (Chief Economist and Director) and Franziska Ohnsorge (Manager) from the World Bank’s Prospects Group. The findings, interpretations, and conclusions expressed in this blog are entirely those of the authors. They do not necessarily represent the views of the World Bank, its Executive Directors, or the countries they represent.
Vehicle Miles Traveled and Fuel Consumption
Gasoline prices have hit a new (nominal) high. The impact on the driving and the economy depends in part on the intensity of use of gasoline and diesel.
Recession, Inflation – What’s the Market View?
The economy is still likely to grow, according to at least the 10yr-3mo spread. Less definitive indicator from the 10yr-2yr. Expected inflation rates have stopped moving up, and so too have implied future rates 2-3 months ahead; in fact they’ve both fallen in recent days. (For what analysis, rather than markets, think about inflation, see Jim’s Monday post; on recession, see Jim’s Wednesday post.