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“We look for headline Consumer Price Index (CPI) to tick up a tenth to 1.8% y/y in September (0.1% m/m) despite another monthly decline in energy prices,” said TD Securities analysts previewing Thursday inflation data from the United States.

Key quotes

“In effect, we expect a close-to -1% decline in gasoline prices to act as a drag for the non-core segment. Conversely, core inflation should stay unchanged at 2.4% y/y, reflecting a firm 0.2% m/m advance “” though slightly softer than in Jun-Aug, as core goods inflation likely lost some steam on a monthly basis.”

“That said, a steady 0.2% m/m gain in services should support core prices in September. We anticipate OER to advance at  0.3% m/m, up from two consecutive 0.2% monthly gains, but for the ex-shelter segment to slow modestly on a monthly basis.”