Zhitong Financial APP learned that Haitong Securities released a research report saying that in general, the core inflation of United States is still at a high position, and the alleviation of overall inflation mainly comes from the contribution of energy inflation relief. Market expectations for interest rate cuts are broadly stable. According to CME observation, as of October 11, the market expects the Fed to continue to cut interest rates in November, with a rate cut of 25BP, and the total rate cut is expected to be around 50BP during the year.
Core inflation in United States picked up slightly. United States CPI was 2.4% year-on-year in September, down 0.1 percentage points from August and the lowest since February 2021. However, the core CPI was 3.3% year-on-year, a slight increase of 0.1 percentage points from August. The CPI in September was 0.2% month-on-month, unchanged from August; The seasonally adjusted month-on-month core CPI continued to rise to 0.31%, significantly higher than the 0.28%, 0.17% and 0.06% in the past three months, the highest since March. In addition, the seasonally adjusted month-on-month annualized rate of core CPI in September was 3.8%, rebounding for three consecutive months and the highest since March.
From the perspective of the CPI structure, the easing of inflation in September is still related to the easing of energy prices. Energy inflation in September was -6.8% year-on-year, down 2.8 percentage points from August, and the month-on-month decline in energy inflation widened to -1.9%, which was a key factor in the easing of headline inflation in September. In fact, the easing of inflation in the last two months has been contributed by the easing of energy inflation.
In detail: core commodities continue to play a role, but the contribution continues to weaken. Goods inflation was -1.3% year-on-year in September, which was in negative territory for four consecutive months, but the year-on-year decline in core goods inflation narrowed to -1.0%, mainly due to the significant weakening of the contribution of used cars. The year-on-year decline in used car prices in September narrowed from -10.4% to -5.1%, and the month-on-month decline also turned positive from -1.0% to 0.3%, the first time since May.
Core services inflation continues to ease. Services inflation was 4.7% year-on-year in September, down 0.1 percentage points from August, and 0.4% month-on-month, up 0.1 percentage points from August. However, core services inflation was 4.7% year-on-year, down 0.2 percentage points from August, especially core inflation was 0.4% month-on-month, unchanged from August. Among them, rental inflation eased, with the main residential rent inflation falling to 0.3% month-on-month from 0.4% in August, and the owner-equivalent rent inflation falling to 0.4% month-on-month from 0.5% in August.
Inflation in core services, excluding rents, picked up. Services inflation, excluding rents, came in at 0.6% m/m in September, up 0.5 percentage points from August and the highest since March. For example, the price of medical care services turned sharply positive to 0.7% month-on-month in September. Public transport prices were as high as 2.4% month-on-month in September.