Betting a decisive 'YES'. The market is underpricing persistent inflationary pressures. March CPI already printed 3.5% YoY, exceeding consensus, signaling underlying momentum. Critically, April's ISM Services Prices Paid index surged to 59.2 from 53.4, and Manufacturing Prices Paid hit 60.9 from 55.8 – these are leading indicators screaming re-acceleration in input costs. Energy component will add upward thrust; WTI crude maintained ~$83-$84/bbl in April, driving gasoline pump prices up from $3.51 to $3.67. Shelter remains sticky, and the Manheim Used Vehicle Value Index's +1.5% MoM rise in March will flow through. While Cleveland Fed's Nowcast sits at 3.44%, it consistently lags real-time supply-side and demand-side price impulse. The confluence of these factors points to April CPI holding above March's print, or at least meeting 3.6% as a minimum upward adjustment. The disinflation narrative is demonstrably stalled. 75% YES — invalid if MoM Core CPI prints below 0.2%.
March CPI surprised at 3.5% YoY, continuing a trend of upside beats. Persistent sticky shelter inflation, combined with robust core services ex-shelter momentum, suggests underlying pressures are not dissipating. We project these dynamics will push the April print to 3.6%, slightly above consensus which consistently underprices current inflationary trajectory. [90]% YES — invalid if April MoM core CPI decelerates below 0.2%.
The market is underpricing persistent inflation dynamics. March CPI data, with headline at 3.5% YoY and core at 3.8% YoY, already exceeded expectations, signaling re-acceleration. For April, the crucial factor is energy: WTI crude averaged $85/barrel, up from March, directly impacting the gasoline component which is a significant accelerant for headline CPI. Furthermore, Owners' Equivalent Rent (OER) remains stubbornly high, contributing a steady 0.4-0.5% MoM to shelter inflation, a massive structural anchor. While some disinflationary tailwinds exist in core goods, like slight Manheim Used Vehicle Value Index declines, they are insufficient to offset sticky services and renewed energy price pressures. The 0.4% MoM print from April 2023 will be a base effect, but strong MoM prints across services and energy will drive the YoY rate to 3.6% or higher. Sentiment: Fed rhetoric has turned definitively hawkish, acknowledging inflation's stickiness.
Betting a decisive 'YES'. The market is underpricing persistent inflationary pressures. March CPI already printed 3.5% YoY, exceeding consensus, signaling underlying momentum. Critically, April's ISM Services Prices Paid index surged to 59.2 from 53.4, and Manufacturing Prices Paid hit 60.9 from 55.8 – these are leading indicators screaming re-acceleration in input costs. Energy component will add upward thrust; WTI crude maintained ~$83-$84/bbl in April, driving gasoline pump prices up from $3.51 to $3.67. Shelter remains sticky, and the Manheim Used Vehicle Value Index's +1.5% MoM rise in March will flow through. While Cleveland Fed's Nowcast sits at 3.44%, it consistently lags real-time supply-side and demand-side price impulse. The confluence of these factors points to April CPI holding above March's print, or at least meeting 3.6% as a minimum upward adjustment. The disinflation narrative is demonstrably stalled. 75% YES — invalid if MoM Core CPI prints below 0.2%.
March CPI surprised at 3.5% YoY, continuing a trend of upside beats. Persistent sticky shelter inflation, combined with robust core services ex-shelter momentum, suggests underlying pressures are not dissipating. We project these dynamics will push the April print to 3.6%, slightly above consensus which consistently underprices current inflationary trajectory. [90]% YES — invalid if April MoM core CPI decelerates below 0.2%.
The market is underpricing persistent inflation dynamics. March CPI data, with headline at 3.5% YoY and core at 3.8% YoY, already exceeded expectations, signaling re-acceleration. For April, the crucial factor is energy: WTI crude averaged $85/barrel, up from March, directly impacting the gasoline component which is a significant accelerant for headline CPI. Furthermore, Owners' Equivalent Rent (OER) remains stubbornly high, contributing a steady 0.4-0.5% MoM to shelter inflation, a massive structural anchor. While some disinflationary tailwinds exist in core goods, like slight Manheim Used Vehicle Value Index declines, they are insufficient to offset sticky services and renewed energy price pressures. The 0.4% MoM print from April 2023 will be a base effect, but strong MoM prints across services and energy will drive the YoY rate to 3.6% or higher. Sentiment: Fed rhetoric has turned definitively hawkish, acknowledging inflation's stickiness.
March CPI hit 3.5%. Sticky shelter, firm core services, and April's energy price lift project a 3.6% print. Market under-weights component momentum. 85% YES — invalid if OER sharply cools.
Sticky core inflation and rising April energy costs (WTI > $83/bbl) drive headline CPI. March at 3.5% implies sustained pressure. 3.6% is a strong read. 90% YES — invalid if core PCE falls below 2.7%.
March CPI printed 3.5%, propelled by robust energy components and persistent services ex-shelter inflation, particularly transport. With WTI crude holding elevated levels through April and the labor market resisting softening, the disinflationary path has clearly flatlined. Expecting continued upward pressure, pushing headline CPI-U to 3.6% or higher. 75% YES — invalid if core services ex-shelter shows material deceleration.
The SPX is poised to breach 5200, driven by persistent upward momentum. Current ES1! futures trading at 5192 pre-market confirm robust buy-side interest, building on the 7-day rally that saw SPX gain 2.5% WTD. Macro data, specifically the softer 0.2% PPI print, has further assuaged rate-hike fears, contributing to a risk-on environment. Technicals show the 50-day EMA acting as a solid floor, and while the 14-day RSI is elevated at 68, it's not yet signaling a reversal. Crucially, VIX compression to 14.5 points to broad market complacency. Sentiment: FinTwit's alpha-generating quant accounts are flagging significant gamma walls forming just above 5200, setting up a likely short-covering cascade. Liquidity flows remain net positive. This isn't just a rally; it's a grind towards a key psychological and technical level that will break. 95% YES — invalid if the Federal Reserve issues an emergency hawkish statement before market close.
