Good news have way more weight when they cluster. I understand the skepticism, but today saw 3 additional pieces of good news on the inflation front. Here is the data and what it means going forward. Prelude: July core CPI came at slowest since Sep 21. That’s important
1/6
Business 1y forward inflation expectations while still significantly above the 2% implicit anchoring, came down to 3.5% in Aug from 3.7% and a peak of 3.8% in March. Unsurprising given recent gasoline and commodity front months move. Encouraging, but trend needs to continue. 2/6
1m annualized Atlanta Fed sticky inflation dropped from over 8% in June to shy of 5.5% in July. It’s still double the 2%-2.5% range but also encouraging. 3/6