US 'core' CPI falls short of forecasts in April
Consumer prices in the States advanced by slightly less-than-expected last month despite a bounce back in energy costs.
According to the Bureau of Labor Statistics, the rate of gain for headline CPI advanced by 0.2% month-on-month and by 2.5% versus the year-ago period in April.
Economists had penciled increases of 0.3% and 2.5%, respectively.
Food price gains sped up, rising by 0.3% on the month after 0.1% increase in March, while those of energy bounced back by 1.4% after the drop of 2.8% seen in the month before.
At the 'core' level meanwhile, CPI was ahead by 0.1% on the month and up by 2.1% on the year, with both the monthly and annualised rates of change printing a tenth of a percentage point below forecasts.
Prices for new vehicles and used cars, in particular, remained weak, falling back by 1.6% and 0.9% in comparison to March, respectively.
Services prices outside of energy were up by two tenths of a percentage point in comparison to the month before, following an increase of three tenths in March.
Within that, the cost of medical care services were 0.2% higher.
Following the release of the data, as of 1459 BST the yield on the benchmark 10-year US Treasury note was down by four basis points to 2.97% and that on the two-year note by another two at 2.51%.
"The underlying U.S. consumer price inflation trend is stabilizing after accelerating since late 2017 and should quell concerns for now about a widespread and sustained heating-up of inflation," said Mickey Levy at Berenberg Capital Markets in response to the data.
"Our base case is for consumer price inflation to increase at a moderate pace in the medium term, without affecting economic momentum or the Fed’s monetary policy dramatically, but we do acknowledge that a slew of survey, producer price data, anecdotal reports, and higher wages point to firming inflationary pressures and that the risks to inflation are to the upside in 2018."