Lates News

Investinglive analyst Eamonn Sheridan predicts that the US Consumer Price Index will decrease by 0.2% month-on-month in June, marking the first decline since the pandemic, driven entirely by a 15% drop in gasoline prices from mid-May to the end of June; the annualized inflation rate is expected to slow from 4.2% in May to 3.8%. The core CPI is expected to increase by 0.2% month-on-month, with the annualized core inflation rate slightly decreasing from 2.9% in May to 2.8%. Service inflation, which includes rental prices, car maintenance, leisure and dining out, has an annualized growth rate of 3.4%, higher than the 2.9% in January and significantly higher than the average level of 2.6% between 2010 and 2019. This means that even though the nominal overall inflation data has improved, the Federal Reserve has almost no basis for relaxing its policies. This presents a challenge for Powell, who will make his first appearance at a congressional hearing this week, as he must demonstrate a determination to curb inflation without appearing too hawkish, leading to overly tight credit conditions. The fragile ceasefire in the Middle East also brings dual risks to energy price outlook. This delicate balance largely depends on how the situation in the Middle East evolves and its impact on oil prices.