TD Securities economists Oscar Munoz and Eli Nir have released an early projection for the United States September Consumer Price Index (CPI), anticipating a headline CPI increase of 0.54% month-over-month. This uptick is primarily attributed to an almost 8% jump in gasoline prices and firmer food prices, following a 0.40% m/m rise in August (CPI NSA index: 336.510 versus the market's current fixing at 336.600) [1].
The economists forecast that core CPI will slow to 0.20% m/m in September, down from 0.29% in August. This would align with a core PCE increase of 0.25% [1]. Core goods prices are expected to have increased modestly, with tariff-exposed categories remaining largely unchanged. However, both new and used vehicle prices are projected to add strength to goods inflation [1].
In the services sector, inflation is expected to mean-revert after a surge in August driven by telephone services. Shelter inflation is likely to have cooled due to a subdued rise in Owners' Equivalent Rent (OER) and a slowdown in hotel rates inflation. Medical care services and persistent strength in airfares are also anticipated to contribute to services inflation [1].
Overall, supercore CPI inflation is projected to slow to 0.23% m/m in September, following an unexpected surge to 0.51% in August. The projections are based on current assumptions and may evolve as more data becomes available, particularly for volatile segments such as gasoline prices, hotel rates, and airfares [1].
CONCLUSION
TD Securities expects a notable acceleration in U.S. headline inflation for September, driven by a sharp rise in gasoline prices, while core and supercore inflation are projected to moderate. These projections suggest ongoing volatility in inflation components, with market participants likely to monitor upcoming data for confirmation.