us dec 2017 cpi and retail sales - preview
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Thursday, 11 January 2018


U.S. consumer prices likely inched up again in December, but at slower pace than a month earlier, while retail sales are projected to have risen for the fourth consecutive month.


Gains in the key U.S. inflation gauge, the Consumer Price Index (CPI) are expected to have eased off November's pace due to declining costs of food and energy. Market forecasts point to a 0.1 percent monthly increase in consumer prices, which would be the sixth rise in a row.  


In November, the measure climbed 0.4 percent, boosted by increase in costs of gasoline, as food prices held unchanged while prices for household goods, clothing and airfare all fell.


The softer-than-expected Producer Price Index, out the day before CPI’s Friday, 12 January 1330 GMT release, did not alter economists’ thinking too much on the CPI trend. The market's consensus forecasts remained unchanged. LiveSquawk News will report both CPI and December retail sales live from the Labor Department.


U.S. consumer prices have risen on a monthly basis every month since July after several ups and downs in the first half of 2017.


The core Consumer Price Index (CPI), which excludes volatile food and energy prices, is expected to have increased 0.2 percent in December versus November’s 0.1 percent.


Year-over-year inflation is likely to have risen by 2.1 percent, following November’s 2.2 percent gain, while the annual core figure likely maintained its 1.7 percent pace in December.


After a steep one-percent drop during the first half of 2017, the annual inflation figure got back on track and has been hovering at or above 2.0 percent level since September. The core year-over-year measure also fell sharply at the beginning of last year and has stayed at or just slightly above 1.7 percent since May.


At the same time, U.S. retail sales report is expected to show U.S. stores, restaurants and online-shopping platforms saw sales growth of 0.5 percent in December after a 0.8 percent November spike. This would be the fourth monthly gain in a row.


The December projected increase was likely caused mainly by gains in car sales. Excluding autos, U.S. retail sales are expected to climb 0.3 percent compared to the one percent jump in November.


The so-called retail sales control group, which excludes volatile autos, gasoline and construction materials, is expected to show a 0.4 percent rise in December, after November’s 0.8 percent gain.


Zuzana Jerabek – LiveSquawk News

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