US disinflation continues, Australia lags

Plus, the RBA gets a new chief comms officer

The US October CPI came in lower than markets had expected, flat on the month and 3.2% y/y, down from 3.7% y/y in September. The core CPI (ex-food and energy) came in at 4.0% y/y, down from 4.1% y/y the previous month. The headline measure less shelter was 1.5% y/y compared to 2.5% y/y in September. On PCE-adjusted basis, this puts the CPI ex-shelter right on the Fed’s target inflation rate of 2%. The US inflation outcome saw US Fed funds futures price a 30% chance of an easing by the March 2024 FOMC meeting. Asset markets responded accordingly.