Fed chair Powell cautions against getting "excited" about today's CPI report ahead of PPI (Thursday 0830ET), reminding us that the latter report carries potentially different implications for the Fed's preferred PCE gauge:
- "The CPI reading was above almost every forecast. But I would just offer ... two notes of caution. One is, we don't get excited about one or two good readings, and we don't get excited about one or two bad readings. The second thing, though, is we target PCE inflation because we think it's simply a better measure of inflation. And so you need to know the translation from CPI to PCE, and we get more data on that tomorrow, we'll get the Producer Price Index. So I think it's always wise, and the people who follow us closely know this, that we'll know actually what the PCE readings are, you know, late tomorrow."