Inflation Check-In: April’s Consumer Price Index

The April Consumer Price Index (CPI) numbers came in and were lower than they were previously — but higher than expected. I see this as a sign that we’re at peak inflation.

But what does this mean for markets?

Because of the base effects of arriving at peak inflation, we’re seeing fluctuations in the markets right now. This means that since rates were still rising over the last year, the year-over-year comparisons are getting tougher.

The markets see that we’re not beating these laps, which in turn causes a deceleration.

And this also means that even though we’re starting to come down from peak inflation, everyday Americans are still hurting from the high rates.

The market is reacting to that data.

We’re looking to see a deceleration in the month-to-month inflationary numbers, which will be a great sign.

The April CPI numbers show that we’ve arrived at peak inflation and are on the other side of the hill. But it’s not a steep one. It’ll be a very gradual decline to get back to 2% inflation.

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