CPI On Tap R U READY???
Ok big event tomorrow as CPI is here, this is what the Street is expecting:
Annual CPI is expected to decline to 6.5% from 7.1% in November
Core CPI, which excludes volatile food and energy prices, edging lower to 5.7% from 6%.
On a monthly basis, the CPI is forecast to stay unchanged while the Core CPI is projected to rise 0.3%.
We feel the latter point is important and if MoM goes negative, look out, risk on will be the trade du jour and front end curves will reprice that FEB meeting. Any number sub 6.4% will also see risk on action, so be ready!
