Tomorrow at 8:30 EDT, the BLS will release the latest inflation report vis-à-vis the CPI index for August 2022. This will be the most recent data that the Federal Reserve will have on inflation and therefore be a key component to their decision on the size of the next rate hike during next week’s FOMC meeting.
On Friday, Fed Governor Christopher Waller indicated that he would back another 75-basis point interest rate increase. Inflation continues to run exceedingly hot peeking in June at 9.1% and 8.5% in July. The vast majority of analysts and economists are forecasting that inflationary pressures will continue to decline fractionally in August.
According to forecasts, tomorrow’s CPI report could reveal a mixed message. There is a unanimous consensus that tomorrow’s report will show a decrease in inflationary pressures. However, the core CPI forecast which strips out energy and food costs is expected to climb from 5.9% to 6.1% year-over-year. There is also a consensus that lower levels of inflation are unlikely to change the decision of the Federal Reserve next week to raise rates by another three-quarter of a percent.