저자: Kevin · 외국인
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5월 CPI·PPI·미시간 기대인플레이션 발표를 앞두고, 근원 인플레이션 둔화 추세가 확인되면 주식에 우호적이나 서비스 인플레가 끈적하면 위험하다고 설명. 연준은 6월 14일 회의에서 금리 인하·동결·인상 중 판단을 위해 다음 두 CPI 결과를 주목. JP모건 시나리오상 헤드라인이 높으면 S&P500 하락 가능성 언급.
다듬은 글
welcome back to another want to expect this week especially before tomorrow which is the Consumer Price Index inflation we're eating it comes out at 5 30 a.m Pacific time I will be live streaming it the very next day we're going to get a PPI and then the very next day after that we're going to get a consumer sentiment survey which is also very important because we need expectations to come down so that the Federal Reserve can actually cut now when I when I say that people like what do you mean the fed's actually potentially going to cut yesterday we Dove deep into this on the channel we talked about how the Federal Reserve wants real rates to be about two percent well if and and that would be measured by what the rate is of the Federal Reserve which is about five percent right now minusing off the one year out inflation expectation which is three percent which creates a two percent real rate that's the formula Jerome Powell gave us well if expectations go down one percent 10.
we can drop interest rates one percent so it's a big deal but guess what drives expectations the actual inflation report so you tend to get this self-fulfilling prophecy where if you get this High CPI inflation report all of a sudden people like watching it prices keep going up and then uh they expect prices to continue to go up and they expect that there's going to be no resolution to the inflationary crisis after all there are still businesses raising prices especially those with large PP pricing power like for example on Wednesday because we're introducing basically a whole new course within a course for free for existing members we're increasing the price to the AI course 120 dollars it's a big deal but fortunately we don't show up in the CPI measure so it doesn't so much matter but what does matter is that on Wednesday we're going to get the CPI data and I'm going to go through the projections with you we've got a few we've got a jpmorgan's expectations for what could happen and then we've got expectations uh for these various surveys so that's the most important one I quickly want to get PPI out of the way which is the producer price inflation a lot of the numbers are going to be higher between CPI and PPI because energy costs were higher in April than they were in March so the headline numbers are going to show an increase increase from the March report and you're going to see kind of a spike up but you'll want to look past the headline numbers and you'll want to look at core numbers because we've already seen energy cut prices basically settle back down a lot of that had to do with OPEC production cuts and a lot of drama around that so uh we'll see some weird headline numbers like for example with PPI we're expecting 0.3 on the month over month whereas before that we were at Point negative five negative 0.5 which is remarkable but if we go to core stripping out energy uh food and trade we're expecting to be at 0.3 on PPI still higher than the 0.1 on the prior report though so we're actually seeing potentially there's some stickiness in that core producer price reading if we end up matching that survey uh which is not great we really want these numbers to come in soft nothing about these price numbers it tells us anything about the state of the economy right that's important to remember too like we could have strong GDP and low inflation so when we get low reads on CPI there's nothing that says oh the economy is faltering because prices are coming in low no no we want price increases to stabilize because everybody's worried markets bond market everybody's worried about stagflation stagflation is when the economy slows down while the same Prime prices are still Rising it's the worst case scenario you want a booming economy with low and stable prices that's what you want slight price increases one and a half two percent maybe two and a half percent increases not runaway inflation because that means the FED has to crimp the economy more and potentially over tight that's the big fear of the stock market right now which is why there's so much tenuousness in the market right before this report now keep in mind that in order for us to maintain that sort of Nike Swoosh recovery we have to slowly Nike downswush in inflation but if inflation reignites tomorrow the Nike Swoosh could be over now before we continue a quick note from the sponsor for this video the Ft edit app huge shout out Who deliver via the Ft edit app eight hand-picked in-depth articles every weekday from world-class journalists to Deep dive stories across the board and spectrum of topics no distractions just award-winning content at a lower price you can now get 30 days as a free trial if you use my link down below that's the Ft edit app just make sure you click the link in the description down below now there are three amazing things that I really love about the app that I'll quickly tell you about number one I think it's so easy to include in your routine 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terms and conditions apply so this is a big deal now I don't think it will be over and we're going to look at these surveys but anything that indicates okay inflation isn't going away it's going to be a problem so again PPI even when you look outside of the volatile segments we're expecting a little bit of an acceleration from point one to point three and that's on Thursday morning 5 30 a.m we'll be covering that live on the channel so come by uh yeah so so that is potentially a red flag we'll want to pay attention to hopefully that comes in soft well also on Friday morning have the and this comes out at 7 A.M Pacific time we'll have report where we are currently expecting the one year out inflation expectation based on that report to drop from 4.6 to 4.4 the fed's pce inflation expectation report is sitting at 2.9 right now we really want to see that University of Michigan one come back down it used to be a lot lower it ran up last month that's not good we do not want that to continue to run up so hopefully that comes in low so we want PPI to come in low we want uh the expectations to come in low but then of course we've got CPI and so what are the expectations for the Consumer Price Index and what are the potential scenarios based on various different prints of what the stock market could do based on JP Morgan's expectations well let's analyze that first CPI month over month way higher than the 0.1 but again that's not core Energy prices are going to drive that up so what's core going to do well core would be okay I would be willing to completely accept a point three percent because that's annualized 3.6 it would show us a continuation of a trend down yes I understand it is higher than two percent but don't worry being higher than two percent is okay it's going to take time to get this number down and that is okay what you want to pay attention to is that the trend is coming down so look for example on screen now you're going to see this latest line which is Bloom and that blue line shows you the latest CPI month over month core reading for CPI again the expectation this time is that we're going to get a 0.3 read a 0.3 read would be right there where that red line is so you can see currently we're slightly above that at 0.4 I'll Circle 0.4 right here in the blue line the pink line is the expectations line sort of the average expectation side so so blue is where we are and what you could see is that this number is very volatile it goes up and then it goes down it goes up it goes down it's pretty volatile right so what you really want is to see a smooth Trend down and you could say we approximately have that it's taking longer than expected but if we draw for example an orange line here and just try to draw an average here we could see that we're probably doing about this that is the blue lines are moving up and down around this but we are clearly trending down and a nice read at point three on the month over month for CPI which is the expectation would be good now lately surveys have been pretty bad that is they're not very accurate there's a lot of volatility and that's normal around periods of economic stress there tends to be a lot of volatility in the data which is unfortunate because when you have volatility in the data well let's just say it makes these surveys less useful and when the surveys are less useful more people get jaded and doubt the outcome of these surveys at all and then they wonder why do we even look at these surveys and I can't blame that because they have been wrong so many times in the past but they're useful for evaluating what the Market's expectations are see if the market expects one thing and we get something totally different well then we kind of know what the stock market's going to do right so that's important now let's consider what and where those expectations sit right now because they're somewhat useful to look at on a chart and we'll look at the core CPI month over month expectations that is right here so on the right side you can see this red bar chart which shows you the most of the expectations for CPI month over month actually average 3.6 that's the average read uh however the median read is point three percent so we kind of tilt closer to 0.4 on this chart with more sitting over here at about 0.3 uh now this does mean that we're pretty open to a downside surprise which I like because boy if we got a 0.2 oh my gosh nobody is expecting a .2 on the core month over month nobody now that could be a sign that it's just not going to happen but that would be fantastic for stocks because nobody's expecting it whereas anything like a 0.3 0.4 I'd say is relatively expected and then of course we taper off over here on the bell curve to about that 0.5 direction that would be terrible that would be very bad if we got something uh in that direction so we don't want to see that the month over month chart itself looks something like this a little bit more predicted at about 0.4 but again the month over month non-core in my opinion doesn't so terribly much matter uh what's going to matter a lot more is what happens with the sticky segments of inflation and as you can see most of our inflation right now is generated by this blue chart right here this blue chart is your services X food and energy segment and we'll really want to pay attention to Services X housing especially since we think that either this month or next month we could actually start seeing the second form of disinflation which is housing disinflation let me remind you really quickly about the three forms number one is Goods disinflation that we already have we already have Goods disinflation you had a lot of goods inflation here in the pandemic see that orange you can see how that orange has basically disappeared over here so we have Goods disinflation or no inflation from Goods we are soon expecting housing disinflation but we still have not yet seen the X Housing Services disinflation that's going to be your haircut CPA attorneys and just other Goods or sorry not Goods other services like going to restaurants air travel and other Associated expenditures with things you hire people to help you with which could be Dental Care Medical Care Services otherwise right these are really sensitive to labor costs so as labor costs rise you tend to see Services inflation rise and even though the labor market has softened it's still pretty dang tight businesses are still hiring people and people still a companies still have job openings and they're not solely for lower income jobs you're still actually seeing some cyber security companies technology companies hiring it seems like they've just gone through sort of a it's insensitive to say but like a weeding and those most people are finding new jobs and that's why the economy keeps sort of booming along and consumers keep spending which seems wild but anyway we're looking for that Services disinflation if we can get X Housing Services coming down to around point three you know that'd be great we got to get away from the 0.4 and 0.5 because those annualized to 4.8 and 6 inflation way too high we need these next two CPI reports to come in Juicy because if they don't if that's going to keep hiking that's not going to be good so a lot of this report is going to help us dictate what the FED is going to do now here's JP Morgan's view JPMorgan views uh that they're they're judging this based on the headline estimate by the way I preferred they did this read based off of the core month over month I don't think the headline matters that much the headline is expected to be five percent so if we got a report above 5.5 percent they think the S P 500 will drop three percent they think there's about a four percent chance of that they do think there's a 25 chance that we're going to get the headline between 5.3 and 5.5 and they think the s p will lose about 0.75 to 1.25 25 chance of that 50 for a 50 chance of a slightly hot to at match which would actually even slightly hot on the headline they think will lead the S P 500 to gain slightly seems like people are bearishly positioned them and then of course you have uh getting a blow which could potentially add to the S P 500 as you see here on screen getting something super low like this basically not going to happen 99 certainty that's not going to happen per JPM but 20 chance of getting that 4.7 to 4.9 again that this does include energy pricing though so I I think that's relatively unlikely the core is going to be much more important and uh we're looking at this core month over month over here uh the implication for core month over month is 0.4 uh that is the uh that is JP Morgan's view the actual survey core is 0.3 so jpmorgan's coming a little hot on that core which wouldn't be great so we'll see what happens but now why does this all matter well again it all matters because of the Federal Reserve so write down these numbers because these are the ones we're going to read off tomorrow morning 0.4 headline month over month year over year five percent core year over year 5.5 core less food and energy 0.3 those are the expectations that'll be followed of course by PPI the price increase for the courses I'm building uh your wealth and the AI uh course for making more money with PPI tomorrow and then U of M on Friday all of this is going to bundle together and give us guidance on what the Federal Reserve is likely to do next the Federal Reserve next meets on June 14th which comes the day after the May CPI release on June 13th that's really important because it means the FED is going to look at these two next reports to determine do we pause do we start talking about cutting or do we hike more right now everything is coming down to these next two reports so 50 on this next report 50 on the next TP airport yes of course we're gonna have other jobs data pce PPI but in my opinion everything based it comes down to those expectations and the CPI reports get so much media attention it's a high pressure on that CPI report tomorrow so I'll see you there tomorrow morning 5 30 a.m Pacific time f you need a bundle code email us at kevin.com and we'll see you in the next one goodbye and good l
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