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    US headline inflation expected to firm at around 0.3% in May – Wells Fargo Sandeep Kanihama

    Research Team at Wells Fargo, expects the US inflation pressures in May to look similar to April, with the headline number continuing to firm at around 0.3% as downward pressure from energy and commodity prices abate.Key Quotes“The core measure continues to trend in line with FOMC objectives, although the Fed prefers the PCE deflator as an official gauge of inflation. Still, the string of steady gains in core CPI supports our view that domestic inflationary pressures continue to build.We noted this week that inflation expectations have yet to react to rising oil and commodity prices. Continued firming in the headline inflation number should help on that front, as prices increase at gas pumps and grocery stores are enough to convince consumers that inflation may persist. We expect inflation to move gradually higher, giving the Fed a stronger case to move toward policy normalization this year.”


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