US consumer prices rose 0.1% m/m (stronger than expected 0.0%). Annual inflation slowed to 3.1% from 3.2%. Core (excluding food and energy) rose 0.3% m/m, maintaining its annual growth rate at 4.0%.
Headline inflation has stabilized at levels above 3% y/y since June, with no significant downward movement. The nominal CPI has now increased by more than 1.4%.
The core index has stabilized at twice the target. Monthly growth rates over the past six months also show no signs of slowing.
Strictly speaking, the Fed has no reason to sing a victory song about inflation on Wednesday night. This is moderately positive data for the US dollar and justifies the Fed’s “higher rates for longer” mantra. Nevertheless, the markets seem to have saved the main reaction for Wednesday night’s FOMC outcome, as in the end it is not so much the data that matters, but the central bank‘s interpretation of it.
