#CPI&JoblessClaimsWatch

#CPI & #JoblessClaimsWatch – What the Latest Data Tells Us

This week’s economic data gave markets plenty to chew on. The Consumer Price Index (CPI) showed inflation is still sticky, with core CPI rising 0.4% month-over-month. Shelter and services continue to apply upward pressure, reminding the Fed that the road to 2% inflation won’t be smooth. Year-over-year, headline inflation sits at 3.5%, slightly hotter than expected, fueling debate over the timing of future rate cuts.

Meanwhile, jobless claims surprised with a jump to 231K, the highest in over two months. Though still relatively low historically, this could signal early cracks in a tight labor market. Whether it’s a one-off or the start of a cooling trend remains to be seen.

Together, the CPI and jobless claims offer a mixed signal. Inflation isn’t cooling fast enough, but the labor market may be starting to soften. That puts the Fed in a tricky position: hold rates higher for longer, or prepare for slowing growth?

Investors are watching closely. The next few weeks will be key in shaping the Fed’s June decision. Volatility is back on the menu.