INSIGNIFICANT INFLATION

April CPI/core CPI both came in soft at 0.2%. The three-month annualized trend in CPI is 1.6%, core is 2.1%. Y-o-Y CPI slid to 2.3% from 2.4% in March while Y-o-Y core CPI was flat at 2.8%. Moreover, Powell’s favorite metric, super-core rose 0.2% M-o-M, the three-month annualized trend is 0.7%, the slowest rate since 10/20. Add steadily weakening wage growth, and even with tariffs, inflationary pressures should be short-lived.