TD preview the US CPI report due Wednesday

Previewing the US CPI data due Wednesday.

• headline likely +0.3% m/m despite another notable gain in energy prices
• expect core inflation slowed to a “soft” 0.3% m/m pace after posting a third consecutive strong gain at 0.4% in March
• unrounded core CPI forecast at 0.27% m/m suggests larger risks for a dovish surprise to a rounded 0.2% increase

Retail sales also:

• expect retail sales to rise for a third consecutive month in April, opening the second quarter on a firm footing
• volatile auto and gasoline stations sales will likely provide a big boost to growth
• the control group also helping to juice the headline—though down vs March
• project sales in bars/restaurants—the report’s only services component—to remain firm

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Earlier:

• Bank of America Headline April CPI forecast is 0.33% m/m & 3.4% y/y

This article was written by Eamonn Sheridan at www.forexlive.com.