March inflation at -0.1% in the US

The US CPI (consumer price index) measure of inflation rose for a second month in March, according to an April 17 report published by the U.S. Bureau of Labor Statistics. The CPI inflation measure increased by 0.2% over the previous month and fell to -0.1% on a year-over-year basis in March. March figures were in line with consensus forecasts. The rebound in oil prices, as well as rising home prices, have helped the inflation rate recover in the US.

March Inflation Report: Gold Up 0.6%, Hopes for Rate Hike Down

Within the index, prices rose in the medical care sector, as well as the used cars and trucks, apparel, new vehicles, household furnishings and operations, and recreation sectors. And, airline fares continued a declining trend in March.

The core CPI measure, which excludes volatile food and energy prices, increased by 0.2% in March on a month-over-month basis, and by 1.8% on a year-over-year basis, the largest increase since October. The March rise in consumer prices casts doubt on the federal funds rate hike in June that many analysts are expecting.

Gold prices are sensitive to US inflation rate

Gold (GDX) prices, which are sensitive to US monetary policy, rose on the news. Rising rates boosts the US dollar upon which the metal is priced, and increases the opportunity cost of holding the precious metal. Spot gold was up 0.6%, boosting gold miner Newmont Mining (NEM) stock up by 3.2% on Friday. Newmont was among the top gainers for the day. Gains were also seen by toy maker Mattel (MAT) and pharmaceutical company Mylan (MYL).

March Inflation Report: Gold Up 0.6%, Hopes for Rate Hike Down

Leading indicators point to steady growth in the US

The Conference Board Leading Economic Index, or LEI, issued monthly, is a composite index of US (SPY) economic indicators that lead overall economic activity. The LEI serves as a good predictor of business cycles and is based on ten different economic statistics:

  • average workweek
  • initial jobless claims
  • new orders of consumer goods
  • new orders of capital goods
  • Institute of Supply Management index of new orders
  • Leading Credit Index
  • the interest rate spread
  • building permits
  • consumer expectations
  • stock prices

The LEI increased by 0.2% in March, following a 0.1% increase in February and a 0.2% increase in January. Yet the figure is below the market consensus of 0.3%.

Positive aspects of the report include the jobless claims component as well as the yield spread. These results reflect the Fed’s zero lower bound key interest rate policy and consumer expectations.

Meanwhile, the European Central Bank’s stimulus package seems to be taking effect in the Eurozone, where the inflation rate is recovering from its recessionary abyss.

Latest articles

Today, Canopy Growth announced that it acquired the Saskatchewan-based KeyLeaf Life Sciences along with entities relating to the company and its intellectual property. Here's what you need to know about the completed deal.

Yesterday, Tyson Foods (TSN) and fellow meat producers Pilgrim’s Pride (PPC) and Sanderson Farms (SAFM) took a hit to their stocks after news came out about an investigation over price-fixing allegations.

On June 24, RH (RH) was trading at $115.01, implying a rise of 21.2% since its announcement of its first-quarter earnings results on June 12. Despite the surge in its stock price, the company is still trading at a discount of 29.1% to its 52-week high.

26 Jun

Roku Stock Fell Close to 7.0% Yesterday

WRITTEN BY Aditya Raghunath

Roku stock fell 6.8% yesterday to close trading at $93.25 per share. Roku stock has lost over 9.0% in market value in the last two trading days. Prior to this pullback, Roku stock was up a whopping 235.0% year-to-date.

26 Jun

Beyond Meat Stock Up Today on New Product Launch

WRITTEN BY Rajiv Nanjapla

Today, Beyond Meat (BYND) announced that its new product, Beyond Beef, will hit markets across the US later this week.

FedEx (FDX) ended fiscal 2019 on a dismal note and reported a significant YoY decline in fourth-quarter earnings. The delivery giant posted adjusted EPS of $5.01, which was 15.2% lower than the year-ago quarter’s earnings of $5.91. The company cited sluggish revenue growth and increased expenses as the main reason behind the dismal bottom-line performance.

172.31.38.64