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Core CPI Slows As Soaring Used Car & Rent Costs Decelerate

Core CPI Slows As Soaring Used Car & Rent Costs Decelerate

After soaring at the fastest pace since 2008, economists expected the surge in Consumer Prices to slow very modestly in July (from +5.4% YoY to +5.3% YoY). They were wrong as CPI came in slightly hot at 5.4% YoY (up 0.5% MoM).

That remains the highest since 2008…

Source: Bloomberg

Under the hood, energy costs increased the most along with new cars.

Rent and Used Car cost appreciation slowed…

Shelter inflation jumped to 2.83% Y/Y from 2.58% in June but rent inflation dipped from 1.92% to 1.91% in July

Used Car prices moved higher but barely…

Which helped drive Core CPI of its highs, suggesting the surge may have peaked for now…

Source: Bloomberg

Finally, we note that 10Y yields have moved at least 5bps on each of the last three CPI days (but none has seen a run up into the print like the last few days).

Tyler Durden
Wed, 08/11/2021 – 08:40

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