Mid-Week Wrap: 13th March 2024
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Market Mood
The headline CPI also rose by 0.4% from January, with surging gasoline costs and shelter expenses accounting for over 60% of the overall uptick. However, food prices remained unchanged for the month. On an annual basis, core CPI saw a 3.8% increase, the lowest since May 2021, indicative of a gradual deceleration in price growth witnessed in the latter half of last year. Meanwhile, the headline CPI registered a 3.2% rise year-over-year in February, slightly outpacing January's 3.1% pace.
In February, the so-called supercore gauge of services prices, excluding shelter, food, and energy, saw a monthly gain of 0.47%, down from January's 0.85% surge. Nonetheless, this category, which has garnered attention from Fed officials, continues to outpace pre-pandemic trends.
Following the release of the report, Treasury yields fluctuated, with yields edging higher as traders assessed the data. Two-year yields increased by approximately 3 basis points to 4.57% by 9:26 a.m., while futures on the S&P 500 Index rose by 0.4%. The dollar strengthened as the report reinforced the argument for the Fed to postpone rate cuts in the near term.