Tonight and tomorrow night, CPI and PPI inflation data will be announced, and something big is likely to happen!
Currently, the market is guessing that these two data points may be higher than last month, but there’s a key point to note: the overall CPI calculated by the Cleveland Fed is 2.4%, but the core CPI is stuck at 2.84%, exactly the same as last month.
Even more exciting, another analyst, Nick, directly stated that the core CPI will soar to 2.9%! What does this indicate? It suggests that tonight's CPI data is likely to exceed expectations, and the market is expected to be shaken!
But don't panic, this data actually won't shake the Federal Reserve's decision-making. After all, the tariff hammer has not really come down yet, and the inflation rebound does not necessarily indicate the subsequent trend. But the problem lies with the fragile nerves of investors! Seeing the data rise, they might imagine, "Oh no, the Federal Reserve will raise interest rates even more aggressively," and then frantically sell off risk assets.
In my opinion, this wave of data is at most an emotional bomb; the real show will have to wait for the actual inflation performance after the tariff policy is implemented. But short-term volatility is definitely unavoidable, so we retail investors should fasten our seatbelts!
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