The first downside surprise in inflation since the turn of the year will be a relief to the niggling concerns that inflation was starting to trend upwards again. - Seema Shah, chief global strategist at Principal Asset Management
In the 12 months through April, CPI rose 3.4%, a smaller gain than the 3.5% the prior month. Core CPI increased at an annualized rate of 4.1% in the last three months, though down from 4.5% in March.
Housing, particularly rent prices, remains a wildcard impacting inflation levels. Service sector price increases like auto insurance and hospital services costs are showing persistence.
April data alone may not sway Fed officials on decisively falling inflation, but sustained trends could bring September rate cuts into consideration.
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