From our colleagues at our sister company, Argent Trust:
Announced this morning, the Consumer Price Index increased 0.1% in August and is 8.3% higher on an annual basis, both more than expected. Monthly prices for Food Away from Home, up 0.9%, New Vehicles, up 0.8%, and Shelter, up 0.7% were all relatively strong, while Gasoline, down -10.6%, was weak. The core rate, which excludes prices for food and energy, increased 0.6% in August, double what was expected, and is up 6.3% on an annual basis.
Overall, a hot report on inflation even with some commodities (such as gasoline) decreasing in recent weeks. The core rate increased more than double what was expected during the month and the annual core rate remains well above levels targeted by the Federal Reserve. Coupled with decent payroll reports and low jobless claims figures indicating a fairly resilient labor market, the Federal Reserve is likely to continue focusing on tightening financial conditions in the coming weeks.
In all, the 10-year US treasury yield ticks higher following the report and equity futures are lower as we head into the market open.
This material is intended to be for informational purposes only and is intended for current or prospective clients of Argent Trust Company. This information is obtained from sources believed to be reliable, and its accuracy and completeness are not guaranteed. Information does not constitute a recommendation of any investment strategy, is not intended as investment advice, and does not take into account all the circumstances of each investor. Forward-looking assumptions are Argent Trust Company’s current estimates or expectations of future events or future results based on proprietary research and should not be construed as an estimate or promise of results that a portfolio may achieve. Actual results could differ materially from the results indicated by this information. Investments can go down as well as up. Past performance is not a reliable indicator of future results.