following Chinese IPC and IPP Chinese print this weekand terrible data from the European core, all eyes are on consumer prices in the United States. The dominant "silver plugs" are hoping it's not too hot to make Powell redouble the hawk and it's not too cold to provoke fear of growth.
And it seems that investors got what they were looking for, the printed CPI exactly matches expectations of + 1.9% over one year (the growth remaining the lowest since August 2017), and paradoxically the same to the CPI of China.
Perhaps the most critical title CPI is now back below the Maginot line of 2.0% prescribed by the Fed.
Under the hood, the index of all items, minus food and energy, rose 0.2% in December. The housing index rose 0.3% in December, the same increase as the previous month. Rent indices and equivalent rents for homeowners both rose 0.2%, while those for homes far from home increased 2.7%.
The recreation index rose 0.6% in December. The index of medical care rose 0.3% in December, its main compositional indices being mixed. The hospital services index rose 0.5%, the index of physician services remained unchanged and the prescription drug index decreased 0.4%. The index of furniture and household operations rose 0.3% in December, and that of education by 0.2%.
The airline fare index fell 1.5% in December, following a 2.4% decline in November. The index of used cars and trucks dropped 0.2% after rising in October and November. The motor vehicle insurance index declined 0.2%, its second consecutive decline. Several indices remained unchanged in December, particularly those relating to new vehicles, clothing and communication.
The biggest factor slowing down the overall CPI comes from the energy complex.
The energy index fell 3.5% in December, following a 2.2% decline in November. The gasoline index fell 7.5% in December after dropping 4.2% the previous month.
And the other positive side for Americans: the pace of growth of housing costs slows down …