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Previewing the US inflation report, which will be released on Wednesday, TD Securities analysts said that they think the Consumer Price Index (CPI) rose strongly in July and it wasn’t caused just by rising crude oil prices.

Key quotes

“We forecast a 0.3% m/m rise in core prices. We expect relatively strong gains in airfares, other lodging, and used vehicle prices in particular. That said, we think the slowing in rents is more indicative of the trend in the year ahead.”

“We expect the 12-month change in core prices to remain low at 1.2% in the July report.”