BMO analysts on the CPI data due on 12 March 2025 at 0830 US Eastern time.
Analysts at BMO argue that Wednesday’s Consumer Price Index (CPI) report will be a crucial gauge for the Federal Reserve’s path to 2.0% inflation, providing essential input for February’s core Personal Consumption Expenditures (PCE) forecast.
- Economists expect a 0.3% monthly gain in core CPI—lower than January’s 0.446% but still high enough to sustain concerns that inflation may prove more persistent than anticipated.
- While such a reading wouldn’t be ideal for the Fed, it wouldn’t derail the broader disinflation narrative, keeping the possibility of multiple rate cuts this year intact.
BMO go on to note that beyond the headline inflation figures, investors will focus on housing services and non-housing “supercore” inflation, two categories that Fed Chair Jerome Powell flagged as areas for ongoing progress. Both are expected to show signs of moderation, though still at historically elevated levels. However, BMO suggests that even if inflation components exceed expectations, a full assessment will require Thursday’s Producer Price Index (PPI) data, which last month played a key role in softening market concerns over an unexpectedly strong CPI reading.
