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Tony Mace was the top editorial executive for Market News
International for two decades.
Washington Bureau Chief Denny Gulino had the same title at Market News for 18 years.
Similar experience undergirds our service in Ottawa, London, Brussels and in Asia.
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–Total CPI +2.7% Y/Y, Unexpectedly Slowing from +2.8% in February Despite Higher Fresh Food Price Rise
–Core-Core CPI (Ex-Fresh Food, Energy) Annual Rate Eases to 16-Month Low of 2.9%
–Services Costs +2.9% Y/Y (+3.1% in February) Amid Wage Hikes Vs. Goods Prices +3.1% (+3.4% Previously)
By Max Sato
(MaceNews) – Consumer inflation in Japan moderated in all three key measures in March in light of easing food and durable goods supplier markups, offsetting the slight upward pressure from a slower pace of decline in energy costs after the base effect of utility subsidies had waned, data from the Ministry of Internal Affairs and Communication released Friday showed.
Hotel fees continued to post a double-digit percentage gain on the year amid a sharp rise in the number of visitors from overseas but their pace of increase has also slowed.
The core CPI (excluding fresh food prices), closely watched by the Bank of Japan for its policy stance, rose 2.6% on year after a 2.8% gain in February, in line with the consensus call of a 2.6% increase. The year-over-year increase in the total CPI unexpectedly eased to 2.7% from 2.8% despite faster fresh food price rises, coming in below the median forecast of a 2.9% rise.
Underlying inflation measured by the core-core CPI (excluding fresh food and energy) decelerated to a 16-month low of 2.9% from 3.2%, just below the median forecast of a 3.0% rise. The annual rate for this narrow indicator had been at or above 3.0 percent from December 2022 until February 2024.
Service costs have seen gradual upward pressures as many firms are offering higher wages to secure workers amid widespread labor shortages but goods prices jumped last month due to a much smaller drop in utility charges. Service prices excluding owners’ equivalent rent rose 2.9% on the year in March, pushing up the total CPI by 0.94 percentage point, following a 3.1% rise (plus 0.99 point) in February. It was much higher than the 2.2% rise seen in March 2023. Goods prices excluding fresh food gained 3.1% (plus 1.50 points), after a 3.4% increase (plus 1.66 point) and down from the 4.8% gain posted a year earlier.
The Bank of Japan is expected to maintain its policy stance next week. At its March 18-19 meeting, the bank’s nine-member board decide in a majority vote to end its seven-year-old yield curve control framework and lift the minus 0.1 percent overnight interest rate target to a range of zero to 0.1 percent from minus 0.1 percent, its first rate hike in 17 years, as part of its gradual process of normalizing monetary policy. Subsequent rate hikes are expected to be at a slow pace as policymakers wish to ensure that Japan will not slip back into deflation.
The key points from CPI data:
* The national average core consumer price index (excluding fresh food) rose 2.6% from a year earlier in March for the 31st year-on-year increase, easing from February’s 2.8% gain and coming in as expected (forecasts ranged from 2.6% to 2.7% gains). The 4.2% rise in January 2023 was a 41-year high, the largest increase since the 4.2% gain in September 1981.
* The underlying inflation rate — measured by the core-core CPI (excluding fresh food and energy) — rose 2.9% on the year in March for the 24th straight year-over-year increase but the pace of increase was the slowest since the 2.8% gain in November 2022. It was below the median economist forecast of a 3.0% rise (forecasts ranged from 2.9% to 3.0% gains). The 4.3% annual rate recorded in May, July and August 2023 was the largest in 42 years, since the 4.5% increase June 1981.
* In fiscal 2023, the core-core CPI jumped 3.9% after rising 2.2% in fiscal 2022 and falling 0.8% in fiscal 2021, coming in just above the BOJ board projection of a 3.8% rise. The board forecast the narrow measure will slow to 1.9% in fiscal 2024 and stayed at the level in fiscal 2025.
* The total CPI rose 2.7% on year in March for the 31st consecutive year-over-year increase, coming in lower than the median forecast of a 2.9% rise (forecasts ranged from 2.8% to 2.9% gains) and after accelerating to 2.8% in February from 2.2% in January. The 4.3% increase in January 2023 was a 41-year high, the largest since the 4.3% rise in December 1981. Fresh food prices, a volatile factor, rose 5.5% on year and pushed up the overall index by 0.23 percentage point after rising 2.5% (up 0.11 point) the previous month.
* In fiscal 2023, the total CPI rose 3.0% after rising 3.2% in the previous year, edging up 0.1% in fiscal 2021, falling 0.2% in fiscal 2020 and rising 0.5% in fiscal 2019. It showed a similar pattern to the core reading’s fluctuations.
* Among key components of the CPI basket of goods and services, energy prices fell just 0.6% on year in March, pushing down the CPI by 0.04 percentage point, after falling 1.7% with a negative 0.14-piont contribution in February and a 12.1% drop (minus 1.07 points) in January. The 0.7% drop (minus 0.06 point) in February 2023 was the first decline since March 2021.
* Gasoline prices rose 4.3% on the year, adding 0.09 percentage point to the CPI following a 4.5% gain (a positive 0.10-point contribution) the previous month. The government has scaled back subsides to refineries.
* Electricity charges dipped 1.0% on year (a negative 0.03-point contribution) after sliding 2.5% (minus 0.09 point) in February and falling 21.0% (minus 0.90 point) in January. In February 2023, they marked the first drop since July 2021. The government began providing utilities subsidies in January 2023 (reflected in February bills onward). The program has been extended until April 2024.
* The prices for natural gas supplied to homes fell 10.1% with a negative 0.12-point contribution, after falling 13.8% (minus 0.16 point) in February and plunging 22.8% (minus 0.30 point) previously.
* The prices for food excluding perishables, which has a large weight in the CPI basket, posted the 33rd straight year-on-year increase but the pace slowed further to 4.6% (plus 1.09 points) in March from 5.3% (plus 1.23 points) in February and 5.9% (plus 1.36 points) in January and down from 9.2% (plus 2.08 points) in August and July 2023, which was the largest increase in more than 46 years since the 9.9% surge in October 1975.
* Accommodations, which have a relatively small weight in the CPI basket of goods and services, rose 27.7% on year (plus 0.25 point) in March after rising
33.3% (plus 0.29 point) in February, 26.9% (plus 0.23 point) in January and 59.0% (plus 0.43 point) in December. The surge in late 2023 was in reaction to a slump in hotel fees in late 2022. The government in October that year began subsidizing domestic travel under a new nationwide program to support the pandemic-hit tourism industry.
By Steven K. Beckner
(MaceNews) – Two Federal Reserve Bank presidents reinforced the growing consensus that the Fed will not be lowering short-term interest rates any time soon Thursday.
John Williams, one of the Fed’s most important monetary policymakers as president of the Federal Reserve Bank of New York, said the Fed’s policymaking Federal Open Market Committee will “eventually” cut the federal funds rate, but said he does not see “any urgency” to do so.
The FOMC vice chairman didn’t even rule our raising interest rates if the inflation data were to dictate such a monetary policy “adjustment.”
Williams observed that the economy remains strong despite the Fed’s 525 basis points of rate hikes since March 2022, implying that the Fed’s rate settings are not as “restrictive” as Chair Jerome Powell has repeatedly portrayed them as being.
Atlanta Fed President Raphael Bostic, a voting member of the FOMC, advocated “patience” and said he sees no rate cuts until late this year.
The Williams and Bostic comments come less than two weeks before the FOMC meets to take fresh stock of economic and financial conditions and set interest rates. And they come in wake of data that not only show inflation running at 3 ½% or more in the first quarter, but also labor markets remaining tight and strong consumer spending propelling GDP growth at a pace well in excess of the Fed’s estimated “longer run” potential.
At its March 19-20 meeting, the FOMC left the funds rate in a 5.25% to 5.50% target range and reiterated 2024 projections for three 25 basis point rate cuts, but declared, “the Committee does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2%.”
Since then, rate cuts hopes have dimmed. Earlier this year, financial markets were expecting the FOMC to start reducing the funds rate in May and to cut it at least six times this year. But as disappointing inflation and other data forced Fed officials to reassess prospects for lowering inflation to 2%, rate cut forecasts have been delayed and diminished. Wall Street Fed watchers now believe the Fed will delay the start of rate cuts until September or even beyond.
In a significant departure Tuesday, Powell seemed to confirm reduced expectations for monetary easing by saying, “the recent data have clearly not given us greater confidence” that inflation is headed toward the 2% target. On the contrary, he said, recent data suggest “it is likely to take longer than expected to achieve that confidence.”
“Right now, given the strength of the labor market and progress on inflation so far, it’s appropriate to allow restrictive policy further time to work and let the data and the evolving outlook guide us,” he added in what was widely seen as a capitulation to the reality of persistent inflation.
Earlier, Vice Chair Philip Jefferson also signaled a cautious, wait-and-see approach to easing. “My baseline outlook continues to be that inflation will decline further, with the policy rate held steady at its current level …. (T)he outlook is still quite uncertain, and if incoming data suggest that inflation is more persistent than I currently expect it to be, it will be appropriate to hold in place the current restrictive stance of policy for longer.”
Some officials, notably Minneapolis Fed President Neel Kashkari, have mused that it may not be appropriate to cut rates at all this year.
Williams did not go that far at a Semafor World Economy Summit, but his open-ended remarks suggested that he does not feel bound by previous FOMC rate cut projections.
Williams said he still sees the Fed wanting to cut rates “eventually,” but gave no time frame or preferred amount of rate cuts. He didn’t even rule out higher rates, although he said that’s not his “base case.”
For now, he said monetary policy is “in a good place.”
Williams pointed to strong GDP and job growth and to positive supply side developments, particularly in the labor market. He said, “we’re seeing imbalances come down.”
He also said, “we’re seeing inflation come down,” but said “we have more work to do.” Lately, he noted, inflation has been “on a little bit of a bumpy road” – an obvious reference to the January through March data which showed inflation averaging over 3%.
So, he said the Fed will “eventually lower interest rates as inflation gets to 2%,” but he added, “I definitely don’t see any urgency to cut rates.”
“My expectation is, as inflation gets all the way to 2% on a sustained basis, as the economy is in good balance, interest rates will need to be lower at some point,” he said, but “the timing of that is driven by the economy.”
Other Fed officials have lately said that the economy’s stronger than expected performance shows that monetary policy is not as “restrictive” as heretofore believed. Williams did not explicitly echo that sentiment, but pointed to strong GDP growth, job gains and 3.8% unemployment as evidence that the Fed’s monetary tightening has not hurt the economy.
“We have a strong economy, we want a strong economy, that’s all very good news, but it also means that the rates that we have haven’t caused the economy to slow too much,” he said.
Throughout last year, Powell and others often stated that achieving 2% inflation goal would likely require “below potential” (1.8%) GDP growth and some “softening” of labor market conditions, although they have also expressed hope that the economy could achieve a “soft landing.”
Asked if the Fed might actually need to raise rates to get inflation down Williams replied, “That’s not my base case,” but “it’s hard to predict the future …. We will adjust our policy to meet our goals .…
“If the data tell us we need higher interest rates to achieve our goals, then obviously we would want to do that,” he added.
He said the Fed’s job is to “make sure supply and demand are in balance.”
Asked if the Fed might abandon its 2% inflation goal, Williams replied with “one word: No.”
“The 2% goal is very important,” he went on. “It’s important not only to have that goal but to actually achieve it to reinforce that credibility.” He claimed the Fed’s commitment to 2% inflation as an objective has helped keep inflation expectations under control.
Bostic, speaking at a forum sponsored by the Greater Fort Lauderdale (Florida) Alliance, also stressed the need to reduce inflation to 2% and advocated “patience” in getting there.
He observed that inflation has been falling, but not as rapidly as hoped, and he said he’s “okay with that” as long as “the economy is producing a lot of jobs.”
Bostic said the Fed’s “restrictive stance will slow us down and get us to 2%.,” but added, “I’m not in mad dash to be there.”
He said he will “be patient” and watch both sides of the Fed’s dual mandate of maximum employment and price stability.
As for the funds rate level, Bostic said, “I’m happy to just stay where we are.”
In Bostic’s view, the FOMC “won’t be in position to lower our rates until toward the end of this year.”
He said he does not foresee a recession.
WASHINGTON (MaceNews) – The following are Thursday’s’s schedules for the White House, Treasury, USTR, the State Department and Capitol Hill as well as U.S. economic data
DAILY GUIDANCE AND PRESS SCHEDULE FOR
THURSDAY, APRIL 18, 2024
In the morning, the President will receive the President’s Daily Brief. This meeting will be closed press.
Then, the President will travel to Philadelphia, Pennsylvania. The departure from the South Lawn will be open press. The departure from Joint Base Andrews will be covered by the out-of-town pool. The arrival at Philadelphia International Airport will be open press.
In the afternoon, the President will participate in two campaign events in Philadelphia, Pennsylvania. The first will be open press, while the second will be covered by the out-of-town pool.
After, the President will return to the White House. The departure from Philadelphia International Airport and the arrival at Joint Base Andrews will be covered by the out-of-town pool. The arrival on the South Lawn will be open press.
In-Town Pool
Wires: AP, Reuters, Bloomberg
Wire Photos: AP, Reuters, AFP, NYT
TV Corr & Crew: CBS
Print: Wall Street Journal
Radio: BBC
Out-of-Town Pool
Wires: AP, Reuters, Bloomberg
Wire Photos: AP, Reuters, AFP, NYT
TV Corr & Crew: CBS
Print: Daily Mail
Radio: iHeartRadio
EDT
9:00 AM THE PRESIDENT receives the President’s Daily Brief
Closed Press
9:00 AM In-Town Pool Call Time
9:30 AM Out-of-Town Pool Call Time
Joint Base Andrews Overhang
10:15 AM THE PRESIDENT departs the White House en route to Joint Base Andrews
South Lawn
Open Press (Gather 10:00 AM – Palm Room Doors)
10:35 AM THE PRESIDENT departs Joint Base Andrews en route to Philadelphia, Pennsylvania
Joint Base Andrews
Out-of-Town Pool
11:20 AM THE PRESIDENT arrives in Philadelphia, Pennsylvania
Philadelphia International Airport
Open Press
12:45 PM THE PRESIDENT participates in a campaign event
Philadelphia, Pennsylvania
Open Press
1:45 PM THE PRESIDENT participates in a campaign event
Philadelphia, Pennsylvania
Out-of-Town Pool
3:50 PM THE PRESIDENT departs Philadelphia, Pennsylvania en route to Joint Base Andrews
Philadelphia International Airport
Out-of-Town Pool
4:45 PM THE PRESIDENT departs Joint Base Andrews en route to the White House
Joint Base Andrews
Out-of-Town Pool
4:55 PM THE PRESIDENT arrives at the White House
South Lawn
Open Press (Gather 4:40 PM – Palm Room Doors)
Briefing Schedule
Press Secretary Karine Jean-Pierre will gaggle aboard Air Force One en route to Philadelphia, Pennsylvania.
###
TREASURY DEPT –
Thursday – Secretary of the Treasury Janet L. Yellen, Deputy Secretary of the Treasury Wally Adeyemo, and other senior Treasury officials will represent the United States in the 2024 Spring Meetings of the International Monetary Fund (IMF) and the World Bank Group (WBG) and will participate in events on the margins in Washington, DC.
At 10:00 AM, Secretary Yellen will participate in a meeting of G20 Finance Ministers and Central Bank Governors. This meeting at the IMF is closed press.
At 12:40 PM, Secretary Yellen will participate in a bilateral meeting with Chancellor of the Exchequer Jeremy Hunt of the United Kingdom. This meeting at the IMF is closed press.
At 1:15 PM, Secretary Yellen will participate in a bilateral meeting with Finance Minister Giancarlo Giorgetti of Italy. This meeting at the IMF is closed press.
At 2:00 PM, Secretary Yellen will participate in the Financial Action Task Force (FATF) Ministerial meeting. This meeting is closed press.
At 3:00 PM, Secretary Yellen will participate in a meeting with Finance Minister Nicola Willis of New Zealand. This meeting is closed press.
At 3:15 PM, Secretary Yellen will host a meeting of the Five Eyes Finance Ministers with Chancellor of the Exchequer Jeremy Hunt of the United Kingdom, Treasurer Jim Chalmers of Australia, Deputy Prime Minister and Finance Minister Chrystia Freeland of Canada, and Finance Minister Nicola Willis of New Zealand. There is a photo spray at the conclusion of this meeting at Treasury, which is open to pre-credentialed press.Media interested in joining this photo spray can email press@treasury.gov.
STATE DEPT
Thursday – Secretary Blinken is on travel to Italy from April 16-19, 2024.
9:00 a.m. LOCAL Secretary Blinken meets with Ukranian Foreign Minister Dmytro Kuleba in Capri, Italy.
(POOLED CAMERA SPRAY AT TOP)
9:30 a.m. Secretary Blinken participates in a G7 Foreign Ministers session on the Middle East in Capri, Italy.
(POOLED CAMERA SPRAY AT TOP)
11:30 a.m. Secretary Blinken participates in a G7 Foreign Ministers session on the Situation in the Red Sea in Capri, Italy.
(CLOSED PRESS COVERAGE)
12:50 p.m. LOCAL Secretary Blinken participates in a G7 Foreign Ministers family photo with AU representatives in Capri, Italy.
(POOLED PRESS COVERAGE)
1:00 p.m. LOCAL Secretary Blinken attends a G7 Foreign Ministers working lunch with AU representatives in Capri, Italy.
(CLOSED PRESS COVERAGE)
3:30 p.m. Secretary Blinken attends a G7 Foreign Ministers session on Russia’s War of Aggression Against Ukraine in Capri, Italy.
(CLOSED PRESS COVERAGE)
4:45 p.m. LOCAL Secretary Blinken participates in a G7 Foreign Ministers family photo with NATO Secretary General Jens Stoltenberg and Ukrainian Foreign Minister Dmytro Kuleba in Capri, Italy.
(POOLED PRESS COVERAGE)
4:50 p.m. Secretary Blinken attends a G7 Foreign Ministers session on Support for Ukraine with NATO Secretary General Jens Stoltenberg and Ukrainian Foreign Minister Dmytro Kuleba in Capri, Italy.
(POOLED CAMERA SPRAY AT TOP)
6:45 p.m. LOCAL Secretary Blinken participates in a G7 Foreign Ministers official family photo in Capri, Italy.
(POOLED PRESS COVERAGE)
7:30 p.m. LOCAL Secretary Blinken attends a G7 Foreign Ministers dinner in Capri, Italy.
(CLOSED PRESS COVERAGE)
Headquarters press briefings, when held on weekdays, occur around 1:15p ET and are livestreamed at State.gov. The transcript of Wednesday’s 1:11p ET briefing is at: https://www.state.gov/briefings/department-press-briefing-april-17-2024/
Tuesday’s 1:20p briefing is at: https://www.state.gov/briefings/department-press-briefing-april-16-2024/
USTR
Thursday – Ambassador Tai has no public engagements.
US HOUSE
Thursday – –Back at 9a ET
US SENATE
Thursday –12:00 p.m.: Convene and resume consideration of the motion to proceed to H.R.7888, Reforming Intelligence and Securing America Act.
UPCOMING US, JAPAN, CANADA ECONOMIC REPORTS AND FEDERAL RESERVE EVENTS
Thursday, April 18 – 8a ET IMF MD briefing on global policy agenda
Thursday, April 18 – 8:30a ET US jobless claims
Thursday, April 18 – 8:30a ET US Philadelphia Fed manufacturing
Thursday, April 19 – 9:05a ET Fed’s Bowman opening remarks, community bank conf
Thursday, April 18 – 9:15a ET Fed’s Williams moderated discussion at Semafor conference
Thursday, April 18 – 10a ET US existing home sales
Thursday, April 18 – 10a ET US leading indicators
Thursday, April 18 – 10:30a ET US EIA weekly natural gas inventories
Thursday, April 18 – 11:00a ET Fed’s Bostic moderated discussion at Prosperity Partnership of Fort Lauderdale
Thursday, April 18 – 12:00 ET US Freddie Mac mortgage rates
Thursday, April 18 – 13:00 ET US 5-year TIPS auction
Thursday, April 18 – 16:30 ET US Fed weekly balance sheet
Thursday, April 18 – 17:45 ET Fed’s Bostic armchair chat at University of Miami
Thursday, April 18 – 19:30 ET Japan CPI
—
Friday, April 19 – 10:30a ET Fed’s Goolsbee moderated Q&A at SABEW in NY
Friday, April 19 – 11:30a ET IMF Concluding IMFC Press Briefing
Friday, April 19 – 13:00 ET US Baker Hughes oil rigs
—
Content may appear first or exclusively on the Mace News premium service. For real-time delivery contact tony@macenews.com. X (Twitter) headline news flow @macenewsmacro
WASHINGTON (MaceNews) – The following are Friday’s schedules for the White House, Treasury, USTR, the State Department and Capitol Hill as well as U.S. economic data
WASHINGTON (MaceNews) – The following are Thursday’s schedules for the White House, Treasury, USTR, the State Department and Capitol Hill as well as U.S. economic data
WASHINGTON (MaceNews) – The Federal Open Market Committee’s latest meeting saw a cautious wariness about the possible arrival of worse data – anticipating the day’s
–Governing Council Looking for Evidence Downward Momentum in Inflation Is Sustained–Governor Macklem: Lowering Policy Rate Too Early or Cutting Too Fast Could Jeopardize Progress Made
WASHINGTON (MaceNews) – The following are Wednesday’s schedules for the White House, Treasury, USTR, the State Department and Capitol Hill as well as U.S. economic data
—Producer Inflation Has Slowed from Recent Peak of 10.6% in December 2022 Amid Relatively Tame Commodities Markets–Producer Prices Up 0.2% M/M on Non-Ferrous Metals, Farm
–Governing Council Monitoring Inflation Expectations, Wage Growth, Corporate Pricing–Governor Macklem Wants to See Clear Downward Momentum in Underlying Inflation By Max Sato (MaceNews) – The
WASHINGTON (MaceNews) – The following are Tuesday’s schedules for the White House, Treasury, USTR, the State Department and Capitol Hill as well as U.S. economic data
Contact Mace News President
Tony Mace tony@macenews.com
to find a customer- and markets-oriented brand of news coverage with a level of individualized service unique to the industry. A market participant told us he believes he has his own White House correspondent as Mace News provides breaking news and/or audio feeds, stories, savvy analysis, photos and headlines delivered how you want them. And more. And this is important because you won’t get it anywhere else. That’s MICRONEWS. We know how important to you are the short advisories on what’s coming up, whether briefings, statements, unexpected changes in schedules and calendars and anything else that piques our interest.
No matter the area being covered, the reporter is always only a telephone call or message away. We check with you frequently to see how we can improve. Have a question, need to be briefed via video or audio-only on a topic’s state of play, keep us on speed dial. See the list of interest areas we cover elsewhere
on this site.
—
You can have two weeks reduced price no-obligation trial for $199. No self-renewing contracts. Suspend, renew coverage at any time. Stay with a topic like trade while its hot and suspend coverage or switch coverage areas when it’s not. We serve customers one by one 24/7.
—
Tony Mace was the top editorial executive for Market News International for two decades.
Washington Bureau Chief Denny Gulino had the same title at Market News for 18 years.
Similar experience undergirds our service in Ottawa, London, Brussels and in Asia.
