The Tell: Stocks could suffer if U.S. inflation cools less rapidly as once thought, Deutsche Bank warns

by | Feb 13, 2023 | Stock Market

New data showing inflation in the U.S. hasn’t cooled as quickly as previously thought could help spur a selloff in stocks and bonds, according to a top Deutsche Bank strategist. In his latest chart of the day, Jim Reid, Deutsche Bank’s head of thematic research, highlighted the latest annual revisions to the monthly consumer-price index data, which were released by the Bureau of Labor Statistics on Friday.

Every year, the BLS updates the seasonal adjustments incorporated in the monthly data, revising the numbers from the previous five years. The latest adjustment impacted data released between the beginning of 2018 and end of 2022. It also recalibrates how changes in prices for various goods and services will be factored into the headline numbers going forward. The latest revisions, released Friday, erased a decline in consumer prices month-over-month in December, what was previously pegged as the first such decline since April 2020. According to the new figures, prices actually rose by 0.1% month-over-month in December, instead of falling by 0.1%, as previous data indicated. See: Americans don’t expect inflation to fall this year This could create problems for markets, since signs that inflation has slowed over the …

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