Housekeeping: Good Afternoon
CPI Analysis for Gold and Stocks
CPI is not necessarily as important as it has been the past year or so. Now that the worst of inflation is behind us ( for the moment), market participants are all focused on the economy itself. The logic is simple, if somewhat perverse. Every bank deems inflation dead based on what they see in the pipeline data. Therefore they extrapolate CPI to continue decreasing until the 2% target is hit.
WEDNESDAY, AUG. 14
8:30 am Consumer price index July 0.2% -0.1%
8:30 am CPI year over year 3.0% 3.0%
8:30 am Core CPI July 0.2% 0.1%
8:30 am Core CPI year over year 3.2% 3.3%
Therefore, some of Wall Street is now focusing more on recessionary cues for a sign of Fed cutting. That focus elevates Retail Sales, the data point due Thursday to a higher status than usual. For example, JPM (below) is looking at both data points together fo rtheir own market reaction grid.