The week ahead - US CPI in focus

2⃣Tuesday: In November, US CPI - both headline and core measures - decelerated, rising by +0.2% month-on-month (MoM) and +0.16% MoM respectively, potentially influenced by methodological assumptions due to missing October data. For December, both measures are forecasted to accelerate, rising by +0.3% MoM.

3⃣Wednesday: China's export data for December is expected to rise by 3% year-on-year. Meanwhile, the New Export Orders sub-index under the NBS manufacturing PMI rose notably from 47.6 in November to 49.0 in December, the strongest since last April, signalling continued export strength.

🛒US retail sales report for November is expected to increase by +0.4% MoM, following a flat reading in October, which was impacted by weaker auto sales after the expiration of EV tax credits at the end of September. The core measure, which rose by +0.5% MoM in October, is anticipated to decelerate to +0.3% MoM

🏭US PPI data for October and November, delayed by the government shutdown, will also be released. As an early inflation indicator, attention will focus on components tied to core PCE (portfolio management & investment advice, air travel). The index is projected to rise by +0.2% MoM in November, following September’s +0.3% MoM increase, driven by goods inflation

📔Finally, the Federal Reserve’s Beige Book, will provide insights into current economic conditions and business sentiment. The November report indicated minimal changes in economic activity and outlook compared to October, with retailers citing reduced consumer spending due to the government shutdown and the expiration of EV tax credits.

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