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Headline inflation rose an expected 0.5% in May, but the beat on the core rate — which cuts out food and energy costs — is pleasing markets.
Headline inflation rose an expected 0.5% in May, but the beat on the core rate — which cuts out food and energy costs — is pleasing markets.
The core rate, though, rose just 0.2% in May against forecasts for 0.3%. U.S. inflation data came in as expected on Wednesday, reinforcing the view that the Federal Reserve will keep interest rates at 350-375 bps at its June 17 meeting but is likely to increase rates by 25 bps by the end of the year. The Consumer Price Index year over year rose 4.2% in May, according to a report from the Bureau of Labor Statistics.
Economists had been expecting a rise of 4.2% following the April 3.8% increase. On a month-over-month basis, CPI rose 0.5%, against expectations of 0.5% and against April's 0.6% rise. Core CPI, which excludes food and energy costs, rose 0.2% in May versus forecasts of 0.3% and April 0.4%. Year-over-year core CPI was higher by 2.9% versus forecasts of 2.9% and April's 2.8%.traded just above $61,000 following the report, mostly unchanged over the past 24 hours.
U.S. stock index futures were down across the board, and the 10-year Treasury yield rose to 4.5%. WTI crude oil continues to head lower, down a further 1% on the day at $88.
Ahead of the CPI data, markets were pricing in a 98% probability that the Federal Reserve would leave interest rates unchanged at its June meeting, according to theCrypto markets are under pressure ahead of key U.S. inflation data, with bitcoin back below $61,500 and trading under its 200-week moving average, a level some analysts associate with prolonged bear markets.
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