10 August 2023
Anticipation was high for today’s CPI report. The headline CPI for July increased by 0.2% MoM, pushing the YoY to 3.2%, breaking 12 months of consecutive declines. Core CPI saw a 0.16% MoM increase, while YoY growth slowed to 4.7%. Major factors include a significant contribution from the shelter index and varied changes in food and energy indexes. With ‘real’ wages slightly up by 0.2% YoY in July, the question becomes – is this an inflection point in inflation? Is the over-optimistic view of the world heading for a disinflationary soft-landing about to crash on the shores of commodity’s reality island?