US September CPI +3.7% y/y versus +3.6% y/y expected

<ul><li>CPI y/y 3.7% versus 3.6% expected</li><li><a href="https://www.forexlive.com/news/us-august-cpi-06-mm-versus-06-mm-expected-20230913/" target="_blank" rel="follow">Prior </a>y/y 3.7%</li><li>CPI m/m +0.4% versus +0.3% expected </li><li>Prior m/m +0.6%</li><li>0.248513%</li></ul><p>Core measures:</p><ul><li>Core CPI m/m +0.3% versus +0.3% expected. Last month 0.3%</li><li>Unrounded core at +0.32% vs +0.278% prior</li><li>Core CPI y/y 4.1% versus 4.1% expected. Last month was 4.3%</li><li>Shelter +0.6% versus +0.3% last month. Year on year 7.2% versus 7.3% last month</li><li>Services less rent and shelter +0.6% m/m vs +0.5% prior</li><li>Real weekly earnings -0.2% vs -0.1% prior</li><li>Food +0.2% m/m vs +0.2% m/m prior</li><li>Energy +1.5% m/m vs +5.6% m/m prior</li><li>Rents +0.5% vs +0.5% prior</li><li>Owner equivalent rent +0.6% vs +0.4% prior</li></ul><p>Fed pricing was at 10% for a November hike and 30% for December ahead of the data, with 77 bps in cuts priced in for 2024. US 10-year yields were trading down 4.7 bps to 4.55% ahead of the numbers and rose to 4.59% afterwards.</p><p>Yesterday, there was a 20-pip kneejerk reaction higher following a hot PPI print that was quickly faded. That could be a hint that the market is no longer concerned about inflation.</p>The index for shelter was the largest contributor to the monthly all items increase, accounting for over half of the increase.Here's the take from Guy Lebas at Janney:"Services ex-food, energy, &amp; shelter (Fed's "super core") +0.1% and running +1.1% 3-month annualized isn't remotely concerning.. Today's CPI isn't going to move the needle on Nov hike (not happening). Beware of "inflation rising" narrative w/next month's data."From Capital Economics:.. excluding shelter, the core #CPI rose by just 0.1% m/m .. Overall, there is nothing here that will convince Fed officials to hike rates at the next FOMC meeting, and we continue to expect a more rapid decline in inflation and weaker economic growth ..”

This article was written by Adam Button at www.forexlive.com.