Economist: “The Biggest Threat” to Inflation Isn't Buried in the June CPI Report

June CPI came in as the year’s best inflation surprise, with headline up 3.5% YoY versus 4.2% in May and the largest monthly decline since April 2020. The sharper disinflation should ease near-term rate expectations and support risk assets. This is likely to move yields meaningfully given the magnitude of the print.

Analysis

June CPI came in as the year’s best inflation surprise, with headline up 3.5% YoY versus 4.2% in May and the largest monthly decline since April 2020. The sharper disinflation should ease near-term rate expectations and support risk assets. This is likely to move yields meaningfully given the magnitude of the print.