Fra Danske Bank:
Overview: Inflation rose sharply in March due to the war in Iran but overall landed close to expectations with no effects on core inflation. The oil futures curve remains in steep backwardation, as markets expect the supply shortage to ease relatively quickly after the two-weeks ceasefire. European natural gas prices are priced to remain at an elevated level towards next winter, while US prices have remained much more stable.
Inflation expectations: Euro area market-based inflation expectations have stabilized around 3.1% for 2026, with 1y1y at 2.08% and 2y2y at 1.98%. US short-term expectations have risen less sharply. Consumers have increased inflation expectations in both the US and euro area.
US: March headline CPI was in line with expectations at 0.9% m/m and 3.3% y/y lifted by a sharp increase in the energy component of 10.9% m/m. Core CPI was on the low side, though, at 0.196% m/m (consensus 0.3% m/m) and 2.6% y/y (consensus 2.7% y/y). The softer core CPI was driven by a drop in the ‘super core’ (services ex shelter), which declined from 0.35% m/m to 0.18% m/m. Core goods prices were 0.1% m/m the same as in February. We still expect core CPI to average only 2.5% in 2026, which should allow the Fed to resume rate cuts in September.
Euro area: Euro area HICP inflation rose to 2.5% y/y (cons: 2.6%) in March from 1.9%. The increase was entirely driven by energy inflation, which surged 6.8% m/m, the second-largest rise since March 2022 where energy inflation rose 12.2% m/m. Other components showed no visible war-related effects, and core inflation fell to 2.3% y/y. Survey based forward-looking indicators were mixed with industry selling price expectations rising sharply while services remained unchanged. The war’s impact has thus been as expected or slightly weaker.
China: March CPI dropped from 1.3% y/y to 1.0% y/y as the boost from the Chinese New Year faded. Core CPI dropped from 1.8% y/y to 1.1% y/y. PPI moved from -0.9% y/y to 0.5% y/y lifted by higher commodity prices. It is not only due to the Iran war, as PPI had increased on a m/m basis for five months prior to March.
Hurtige nyheder er stadig i beta-fasen, og fejl kan derfor forekomme.
