So both the headline and core US CPI month-on-month prints came in at 0.4% in April, as expected. Favourable rounding means that the annual rate of headline inflation slows to 4.9% from 5% (consensus 5%), while the annual rate of core inflation drops to 5.5% from 5.6% as predicted. Remember we peaked at 9.1% for headline inflation in June last year and 6.6% for core inflation in September, so we continue to move in the right direction. However, MoM CPI prints of 0.4% are well above the 0.17% MoM rate we need to average over time to bring the annual rate of inflation down to 2%, hence the Fed won’t be incentivised to ... (full story)