US inflation is still high, but less than the expectations of the big names. The money supply collapses
US inflation remains above target and relatively high, but lower than previously expected. The US annual inflation rate fell to 4.9% in April 2023, the lowest since April 2021, and below market expectations of 5% . Food prices grew at a slower pace (7.7% vs 8.5% in March), while energy costs fell further (-5.1% vs -6.4%) , including those of petrol (-12.2%) and diesel (-20.2%).
The cost of housing, which accounts for more than 30% of the total CPI basket, also slowed for the first time in two years (8.1% vs 8.2%) and used car and truck prices fell once again time (-6.6% vs -11.6%). Compared to the previous month, the CPI rose by 0.4%, much higher than the 0.1% in March but in line with market expectations. Safe-haven assets were the main contributor to the monthly increase in all items, followed by cars, used commercial vehicles and gasoline.
Here is the related graph
These were the inflation expectations of major lenders
- 5.1% – Goldman Sachs
- 5.1% – Citigroup
- 5.1% – JP Morgan Chase
- 5.1% – Morgan Stanley
- 5.0% – Barclays
- 5.0% – Bank of America
- 5.0% – Credit Suisse
- 5.0% – Bloomberg Economics
- 5.0% – HSBC
- 5.0% – UBS
- 5.0% – Wells Fargo
Here is an analysis of the main elements:
Let's see how energy was the negative and positive protagonist of inflation in the initial phase and then, indirectly due to its effect on the cost of goods, also in the subsequent phases. At the same time we see that the US has a real vertical fall in the money quantity M2
Such a sharp fall of Mass M2 could be a sign of a forthcoming ventral recession
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The article US inflation is still high, but less than the expectations of the big names. Collapse of the money supply comes from Economic Scenarios .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/linflazione-usa-e-ancora-alta-ma-meno-delle-attese-dei-big-crolla-la-massa-monetaria/ on Wed, 10 May 2023 16:29:34 +0000.