❗️🇺🇸Cable FX Macro Weekly Note: U.S. September CPI

**As seen in Risk In The Week report 10/07/22, subscribe at cablefxm.co.uk/reports

U.S. headline consumer prices slowed to 8.3% Y/y in August, this surprised markets as the consensus forecast was set for an 8.1% rise. The monthly figure accelerated by 0.1%, vs expectations of a 0.1% decline. Market participants focus shifted to the core figure as it printed at 6.3% Y/y, above the prior 5.9% and the consensus of 6.1%, prices excluding volatile components are seen rising faster again in September. Last month saw services prices rebound to 0.7% m/m from a prior rise of 0.3%, housing and shelter jumped by 0.8% and 0.7%, respectively. Gasoline prices dropped a massive 10.6% M/m, this was the most since the April 2020 Covid price decline and followed a previous -7.7%. As energy prices eased, transportation showed a 2.3% M/m fall, while airline fares printed at -4.6%. Food prices accelerated by 0.8%, this was the highest in two months. Analysts at Scotiabank say they expect the headline consensus to bring a 0.1% M/m print, they note that this would take the Y/y figure below 8.0% for the first time since February. However, Scotia expects the core figure to accelerate further to 6.6%, the highest since August 1982. They also comment on the drop in gasoline prices, which they see knocking about a half of a percentage point from the M/m inflation print. Analysts at ING hold a more encouraging inflation outlook over the medium-term as expectations continue to fall back. ING notes that pricing plans from corporates continue to decline rapidly, the desk will be closely watching the NFIB small business optimism report to get further colour of firms pricing plans.