Inflation reaccelerates amid oil shocks, ISM prices spike and 2022 parallels
Key Questions
What are the latest CPI and PCE nowcasts?
Cleveland nowcasts CPI at 3.25% for March and 3.28% for April, PCE at 3.58-3.71%. March CPI expected +0.9-1% m/m, core +0.3%, PCE +0.4%.
How high are ISM services prices?
ISM services prices hit 54, the highest since 2022, signaling reacceleration amid oil shocks and supply snarls from Iran war.
What are short-term inflation expectations?
Short-term expectations are 4-5%, with risks over 6% if oil stays above $100 and April exceeds 3.5%. PCE April 9 is key to watch.
Are there parallels to 2022 inflation?
US inflation shows worrying 2022 parallels with surging energy costs, global food prices rising, and ISM spikes echoing prior surges.
Could the Fed raise rates to fight inflation?
A key official says inflation fears, including from Iran war, could push Fed to hike rates under higher-for-longer policy. This realigns markets.
What drives the inflation reacceleration?
Oil shocks pass through to gas/food, with ISM prices highest since '22, consumer goods up 2% YoY, and stagflation risks as real wages lag.
How do oil shocks link to gold and broader inflation?
Every oil shock in 50 years has rallied gold via the same mechanism, deepening crises like America's hidden storm per Prof. Jiang Xueqin.
What are March CPI expectations?
Expect +0.9-1% m/m headline CPI from gas/food/oil, core +0.3%, amid 2022 echoes and supply shocks pushing PCE higher.
Cleveland nowcast CPI3.25%Mar/3.28%Apr/PCE3.58-3.71%; ISM svcs54 prices highest since'22; short-term expecs4-5%; March CPI exp +0.9-1% m/m/core+0.3%/PCE+0.4% on gas/food/oil pass-thru/supply shock/2022 echoes; stagfl/real wages low; >6% risks w/sust oil>$100/>3.5%Apr; PCE Apr9 watch.