#CPI&JoblessClaimsWatch

Let's break down the latest data on CPI and jobless claims:

CPI Data:

- The Consumer Price Index (CPI) rose by 0.1% in March, bringing the 12-month trend rate down to 2.4% for overall CPI and 2.8% for core CPI.

- This is a definite improvement in inflation figures, moving trend rates closer to the Fed's long-term goal of 2.0%.

- However, the impact of tariffs on goods may push CPI higher in the future.

Jobless Claims:

- Initial jobless claims remained subdued at 223,000 for the week ending April 5, with the four-week average unchanged.

- This suggests that firms continue to hold tight to their workers, and there should be no significant jump in unemployment rates for April.

- Recent data shows a historically strong labor market, with layoffs not picking up and small businesses raising wages.

Market Implications:

- Despite good economic data, equity and fixed-income markets are off due to expectations of higher inflation and unemployment claims post-tariff implementation.

- The Fed's rate cut path is being closely watched, with markets pricing in lower odds of a rate cut in March due to resilient inflationary pressures.