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The April Consumer Price Index (CPI) report was a surprise but it doesn’t alter the fundamental inflation outlook, argued  Fed Governor Christopher Waller on Thursday, as reported by Reuters.

Additional takeaways

“US  economy is going gangbusters, despite thud  of the weak jobs report.”

“Now is the time to be patient, steely-eyed central bankers.”

“Need several more months of data to know if the economy has made substantial further progress,  Fed’s benchmark for tapering asset purchases.”

“FOMC to maintain accommodative policy for some time.”

“Factors putting upward pressure on inflation are temporary.”

“Labor supply shortage is likely temporary.”

“Fed needs to see inflation overshoot target for some time before it will react.”

“At least six factors pushing up inflation temporarily, but not to sustained, high rates.”

“Prospects good that GDP will be close to trend output by end of 2021.”

“Fast growth in housing prices does bear close watching.”

Market reaction

The US Dollar Index largely ignored these comments and was last seen trading flat on the day at 90.76.

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