CPI Tomorrow August 10th 2023 The next read on consumer prices for the month of July is due out tomorrow morning, August 10, 2023. CPI is forecast to rise 0.2% MoM on a headline and core basis (the same as June). Because of base effects, the YoY CPI number is actually set to rise back above 3% this month assuming the MoM number comes in around 0.2%. If we do see a rise in the YoY CPI reading, it will end a streak of 12 monthly declines in YoY CPI.
The rise in the YoY CPI reading in July would be due to base effects. Base effects occur when the current month's inflation rate is compared to a previous month's inflation rate that was unusually low. In this case, the July 2023 YoY CPI reading will be compared to the June 2022 YoY CPI reading, which was 0.8%. This means that even if the July 2023 MoM CPI reading is only 0.2%, the YoY CPI reading will still be above 3%.
A rise in the YoY CPI reading would be significant because it would end the longest streak of monthly declines in YoY CPI on record. This would be a sign that inflation is starting to pick up again, which could have implications for the Federal Reserve's monetary policy.
I will be interested to see what the actual CPI numbers are tomorrow morning.