What is the inflation outlook? (15Nov2023)
Latest US CPI dated 14 Nov 2023 The latest MoM inflation is almost zero. Considering shelter which is a lagging indicator, could we be in deflationary mode? Disinflationary outcome is definitely possible with the Fed hinting at cutting interest rates in 2024. However, here are my considerations: Strikes and wage increase With the various strikes resolved through pay increases, the inflation will be passed on. this has spread from Hollywood to healthcare, auto workers, and teachers. will more follow? Port workers have already signalled strikes by Oct 2024. Minimum wage California's minimum wage will be $20/hr from 1 Apr (from the current $15.50/hr) This is also inflationary. Following Governor Gavin Newsom’s decision — after some complicated political wrangling between Newsom and a furious fast-food lobby — to impose a $20 hourly minimum wage on the fast-food industry, Chipotle and McDonald’s announced on Q3 earnings calls yesterday that they’ll be ra...