The consumer price index rose 0.4% in December on a seasonally adjusted basis but core prices, which exclude the volatile food and energy categories, were up only 0.1%.
Inflation Expectations in Europe Rise to Highest in Over a Year
Hopes around the rollout of Covid-19 vaccines and accommodative central banks are boosting price forecasts
A shoe shop offering discounts during the winter sales in Seville, Spain. Photo: Maria Jose Lopez/Contacto/Zuma press By Jan. 13, 2021 11:49 am ET
European inflation expectations are rising as investors anticipate ongoing easy monetary policy and a global economic rebound boosted by U.S. fiscal spending.
The closely watched 5-year 5-year forward inflation swap rate for the euro area rose above 1.35% Tuesday, the highest in over a year. It continued to hover near that level Wednesday. The metric shows an average expectation for price increases over five years.
Economic data out this week includes a pair of inflation measures. On Wednesday, the Bureau of Labor Statistics reports the Consumer Price Index for December. Excluding volatile food and energy components, it’s expected to have risen 1.6% year-over-year. The core Producer Price Index for December, out Friday, is predicted to have increased 1.3% from last year.
On Friday, the Census Bureau reports retail-sales data for December the all-important holiday shopping season. Retail sales excluding autos fell 0.9% in November, and they’re expected to have climbed 0.4% last month.
Other economic releases this week include the National Federation of Independent Business’ Small Business Optimism Index for December on Tuesday and the University of Michigan’s Consumer Sentiment Survey for January on Friday.
Democratic victories in the Georgia Senate races this week have spurred investors to bet on a higher spending government that will bring growth and inflation to the U.S. economy.