Bassanese Bites: Time for shock and awe? – September 19 2022
Week in review
Without doubt the highlight of the past week was the higher than expected US CPI result, with both headline and core inflation worse than market expectations. The big shock was core inflation (excluding food and energy) which rose 0.6% compared to a market expectation of 0.3%. In turn, this result reflected stubborn stickiness in a range of areas such as rents, health care and even home furnishing. With supply pressures easing and declines in some commodity prices, to my mind the result highlights the ability of business to preserve – and even boost – profit margins through price increases at a time of still strong consumer demand.
