- April CPI rose 3.4% over the last 12 months vs the expected 3.4%
- This is much better than 3.5% vs the expected 3.4% in March this year.
- April CPI increased 0.3% from March breaking off the trend of 2024 first three months +0.4% pace, and lower than the +0.4% consensus.
The economy would benefit drastically if the interest hike reached a peak, and started to turn around.
Loans are much less likely to go on to default as inflation comes down.
A study by credit agency TransUnion has shown that inflation pushes borrowers with low FICO scores to default. Default is always a concern for investors of lending institutions.
Fed chair Jerome Powell is more likely to cut the rate this year sooner than later as inflation comes down.
The CPI report, interest rate hikes, house prices and rents, wage growth, job openings, unemployment rate, international conflicts, and trade wars all play a significant role in guiding the market's microenvironment.
"In April, the Consumer Price Index for All Urban Consumers increased 0.3 percent, seasonally adjusted, and rose 3.4 percent over the last 12 months, not seasonally adjusted. The index for all items less food and energy increased 0.3 percent in April (SA); up 3.6 percent over the year (NSA)."