US: Easing inflation? – TDS

Analysts at TD Securities note that the US headline CPI rose 0.2% MoM in December, below the 0.3% consensus.

Key Quotes

“More important for markets, core prices rose just 0.1% m/m (0.113% before rounding), below expectations at 0.2%. The 12-month change in core prices remained at 2.3%, consistent with the pace for the Fed's preferred core PCE measure remaining below 2%.”

“Within core prices, weakness was led by declines in airfares (-1.6% m/m), used vehicles (-0.8% m/m) and lodging away from home (-1.8% m/m), but the key rental components were slightly on the soft side as well.”