Tuesday, May 15, 2007

Well, it looks like we're going to have to wait a little longer for that DJIA "correction" everyone's expecting to happen any day now (the puts and shorts just can't seem to catch a break). The CPI was up 0.4% in April which was 0.2% lower than March numbers and 0.1% lower than economists expectations of 0.5%. Meanwhile, Core prices (consumer prices excluding food and energy) were up 0.2%. Also key is the 2.3% annual increase in core prices that came short of forecasts, which means
The 2.3 percent annual increase in core prices, also less than forecast, suggests that surging fuel costs aren't triggering a broader jump in the cost of living. The report may reassure Federal Reserve officials, who are counting on slower growth to ease inflation.
"It's consistent with a gradual unwinding of inflation pressures,'' said Brian Bethune, an economist at Global Insight Inc. in Lexington, Massachusetts. "There's nothing in here to push the Fed one way or the other.'' Policy makers have kept their benchmark rate unchanged at 5.25 percent since August."

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