US CPI Report: Trump Tariffs and Inflationary Concerns Ahead of April Data Release.

The US consumer price index (CPI) report for April is being analyzed for potential price increases due to President Trump's tariff program. The report is scheduled to be released at 8:15 a.m. New York time, and the market reaction will be covered live. The focus is on whether and when inflationary pain may start to be felt, and how severe it might be.

The US consumer price index (CPI) report for April is set to be released at 8:15 a.m. New York time, with markets eagerly awaiting the data to gauge the impact of President Trump's tariff program. The report will provide insights into whether and when inflationary pain may start to be felt, and how severe it might be.

The CPI report is expected to show a modest increase of 0.3% month-on-month, staying unchanged at 2.4% on a yearly basis [2]. The core CPI is forecast to rise by 0.3% over the month, while core CPI year-on-year remained unchanged at 2.8%. However, the cooldown in inflation is likely to be temporary as the broad-based reciprocal tariffs kicked in on April 9.

Trump's tariff program has been a significant source of concern for economists, including former US Treasury Secretary Larry Summers. Summers warned that if Trump fulfills his campaign promises, inflation will be even worse than when it reached a 40-year high last time [1]. The tariffs are expected to have raised the price of many imports, with businesses potentially frontloading their imports before the tariffs took effect.

Despite these concerns, Trump's transition team and potential Treasury Secretary Scott Bessent have dismissed worries about inflation. They argue that Trump's economic agenda will not recreate a crisis of affordability and that he will swiftly take action to bring back jobs, lower inflation, and increase real wages [1].

The April CPI report is likely to be a key indicator of the impact of Trump's tariffs, but it is not expected to be a disaster. The focus will be on how much of the tariff-related price increases have been passed on to consumers. Any unexpected strength in the economy could prompt the Federal Reserve to reconsider its wait-and-see stance on rate cuts.

In addition to the CPI report, markets will also be watching US retail sales, UK and Japanese GDP, and trade negotiations between the US and China. The talks in Switzerland between US Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer with senior Chinese officials are particularly noteworthy.

The market reaction to the CPI report and the ongoing trade negotiations will be closely monitored. Any signs of progress in the trade talks could boost market sentiment, while disappointment could lead to a selloff in risk assets.

References:
[1] https://www.moomoo.com/news/post/28261158/record-tr4cking-news-applovin-nvidia-arm-shopify-alphabet-coinbase-d-wave-quantum-peloton
[2] https://www.investing.com/analysis/week-ahead--all-eyes-on-us-cpi-and-trade-talks-amid-no-end-to-tariff-uncertainty-200660595