Archive

January 17, 2025
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Inflation Peak From Festive Germany

  • The final Euro area inflation print for December confirmed the headline rise to 2.4%, albeit with energy contributing a bit more, offset by even less from food prices.
  • Germany drove the rise amid much higher package holiday prices this year. Its median increase also remained too high, almost matching the UK's above 3% annualised.
  • December still looks set to be the peak. Falls in the following two months may not be enough to regain the target as services inflation persists at uncomfortable heights.

By Philip Rush

January 15, 2025
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US CPI Excess No Worse Than Peers

  • Headline US inflation aligned with the consensus for December, although the core rate was marginally weaker, challenging the prevailing hawkish Fed narrative.
  • Expectations have been repeatedly marked higher in recent months, with the outcome exceeding most previous vintages, except those made during Q2 2024.
  • Persistently excessive inflation data threatens the Fed’s cutting cycle, although the US economy is not the hawkish outlier often assumed and embedded in market pricing.

By Philip Rush

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