- Prior was -0.3% (revised to -0.1%)
- Ex autos +1.0% vs +0.6% expected
- Prior ex autos +0.5% (revised to +0.6%)
- Control group +0.8% vs +0.3% expected
- Prior control group +0.0% (revised to -0.3%)
- Ex autos and gas +0.7% vs +0.1% prior
- Prior ex autos and gas +0.1%
- Retail sales +8.4% y/y unadjusted for inflation (inflation 9.1% y/y in June)
- Sales y/y ex gasoline stations 5.1% unadjusted for inflation
Economist estimates range from -0.1% to +2.2% for the headline and -0.6% to +0.7% for the control group. Citing this report and next week's housing data, Fed Governor Waller said yesterday, "If that data come in materially stronger than expected, it would make me lean towards a larger hike at the July meeting."
These numbers are certainly stronger than expected and with the revisions to the headline prior, it adds to the case. On the control group, it was above the highest economist estimate (+0.7%) so that sounds like 'materially stronger' but note the -0.3 pp revisions lower to last month.
Overall, this is a tough one. It's certainly stronger but 'materially'? And we also have to keep in mind that Waller is a hawk so you can't assume he's speaking for the whole FOMC. Market pricing has moved to 53%-47% in favor of 75 bps.
We will hear from the Fed's Bostic shortly and Bullard at the top of the hour. I wouldn't be surprised if others pop up today as well as the blackout starts tomorrow.
/inflation
