CPI

CPI comes in at +0.8% versus +0.4%. YoY 5.6% versus 5.1%.  Still climbing.

Jobless Claims come in at 450,000 higher that 435,000 expected.

Continuing Claims 3,417,000 versus 3,310,000.  These numbers are indicative of recessionary period.  This ultimately should help in bringing the CPI down.

Below is a chart of the Initial Claims data during the last recessionary period.  During that time, the Initial Claims had a move up over the 400,000 level and stayed above the level for an extended period.

The UK CPI came out at a high 4.4% from the previous 3.8%.  This was forecast for a rise to 4.1%.

The Core CPI also came out above expectation at 1.9% from the previous 1.6%.  This was forecast at 1.7%

We saw the GBP initially make strong positive move across the board and firm up.  This knee-jerk reaction reversed very quickly as the GBP was dragged down lower than the levels before the release.

The French CPI came out at -0.2% from the previous 0.4%.  This drop to -0.2% was forecast.

The EUR was bid across the board as this data was released and this release did not move the currency.   

The CHF CPI m/m comes out at -0.4 from the previous 0.2% and y/y 3.1% from 3.0%.  This was forecast for a drop to -0.5%.  The y/y release is the highest since November of 1993 while the m/m is the lowest reading in over a year.

The CHF was dragged down slightly across the board after this weak CPI data.   

The German Prelim CPI comes out at its highest level since August of 1994 at 0.6% from the previous 0.3%. This was forecast from 0.5%.

The EUR made small gains across the board after this data was released.   

The Core CPI comes out at 0.1% from the previous 0.3%.  This was forecast for a small drop to 0.2%. 

The CPI comes out at 0.7%.  This was forecast for a rise to 0.5%.

The CAD made gains initially off this data only to reverse very shortly after.  The CAD is trading back at almost the exact levels before the CPI data.   

The CPI comes out at 4.0% from the previous 4.0%. This was forecast for 4.0% once again.

The Core CPI comes out at 1.8% from the previous 1.7%. This was forecast for a slight rise to 1.8%.

Not much change in the EUR across the board as both figures were in line with forecast.

The French CPI comes out at 0.4% from the previous 0.5%.  A drop to 0.4% was forecast for this release.

There was no initial EUR reaction after this release as this data came out as forecast.  

Due to soaring food and fuel prices, the UK CPI comes out at 3.8% from the previous 3.3%. This was forecast at 3.6%. This is the highest CPI release since June of 1992.

The CORE CPI comes out at 1.6% from the previous 1.5%. This was forecast for 1.5% once again.

This data gave the already surging GBP a serious push of about 40 PIPS vs the USD which lasted only briefly then reversed back to pre-data levels.

As the UK is in a situation where economic growth is slowing and inflation is rising, this inflation/CPI data disputes any argument for a near-term interest rate cut. "The Bank of England can't cut rates until it is convinced that inflation is moving downwards" said James Knightly from ING.

The CPI number comes out at 0.2% from the previous 0.8%.  A decline to 0.4% was forecast for this release. 

There was not much change in the CHF after this data.