INFLATION IMPROVES

Inflation eased slightly in April. The CPI rose 3.4% Y-o-Y, down from 3.5% in March. Similarly, core-CPI rose 3.6% Y-o-Y, the lowest rate since 4/21 and down 3.8% M-o-M. However, both the CPI and core-CPI rose 0.3% M-o-M, much too high if 2% Y-o-Y inflation is the goal. This report isn’t enough for the Fed to cut rates soon but certainly preserves the possibility of rate cuts later this year.