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Will CPI remain at 40-year highs?


January 2022 CPI data are scheduled to be released on Thursday, February 10, 2022, at 8:30 A.M.

  • Economists are forecasting a 7.3% year over year increase in January’s CPI (Consumer Price Index) after a 7% rise in December. The Core CPI, which excludes volatile food and energy prices, is expected to rise 5.9% compared to 5.5% previously. As the chart below shows, the current level of the CPI is at a 40-year high.
  • In Astoria’s view, inflation was notably lower over the past decade as lower interest rates spurred the growth of technology which resulted in lower prices for goods and services. As we have argued in the past, we believe inflation will remain structurally higher in the years ahead as supply chains are rebuilt and corporations have pricing power. People seem willing to pay higher premiums for goods and services.

Exhibit 1
United States CPI

Source: FactSet, US Department of Labor. Data as of January 12, 2022.

January 2022 PPI data are scheduled to be released on Tuesday, February 15, 2022, at 8:30 A.M.

  • In terms of next week’s PPI (Producer Price Index), economists are forecasting a 9.8% year over year increase in January after a 9.7% rise in December.
  • One risk that may be worth monitoring is if inflation pressures impact consumer spending which could potentially hurt the US economic recovery.

Exhibit 2
United States PPI

Source: FactSet. Data as of January 13, 2022.

Best,
Nick Cerbone


Please note that Astoria Portfolio Advisors serves as a subadvisor to the AXS Astoria Inflation Sensitive ETF. The information contained does not imply a recommendation for PPI. Readers should consult their financial advisor to determine if PPI is a suitable investment for their portfolio. For more information on PPI, please click here.

Astoria Portfolio Advisors Disclosure: Past performance is not indicative of future performance. Any third-party websites provided on www.astoriaadvisors.com are strictly for informational purposes and for convenience. These third-party websites are publicly available and do not belong to Astoria Portfolio Advisors LLC. We do not administer the content or control it. We cannot be held liable for the accuracy, time-sensitive nature, or viability of any information shown on these sites. The material in these links is not intended to be relied upon as a forecast or investment advice by Astoria Portfolio Advisors LLC and does not constitute a recommendation, offer, or solicitation for any security or investment strategy. The appearance of such third-party material on our website does not imply our endorsement of the third-party website. We are not responsible for your use of the linked site or its content. Once you leave Astoria Portfolio Advisors LLC’s website, you will be subject to the terms of use and privacy policies of the third-party website. Refer here for more details. 

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