Morning Brief – Inflation and Fed Speak

Markets were in a quiet mood ahead of the release of CPI inflation data in the FOMC meeting minutes, however, during the Asia session Japan’s inflation data was released and a number of Fed members spoke.

After a mixed performance on Wall Street, Asia followed suit Wednesday. Tokyo, Shanghai, and Sydney rose but Hong Kong, Singapore, Taipei, Manila, and Jakarta turned lower.

Data revealed that Japan’s wholesale prices rose 7.2 percent in March from a year earlier, with the pace of increase slowing for the third straight month, data showed on Wednesday, offering some relief to households and firms hit by a steady rise in raw material costs.

The gain in the corporate goods price index, which measures the price companies charge each other for their goods and services, was roughly in line with a median market forecast for a 7.1 percent gain.

In terms of Fed speakers, Neel Kashkari of the Minneapolis Fed was out on the wires alongside Chicago Federal Reserve head Austan Goolsbee.

Fed member Kashkari said: “I’m not ready to declare all clear, but there are hopeful signs that these risks are now better understood and calm is being restored.”

During prepared remarks at an event hosted by the Economic Club of Chicago. Chicago Fed member Austan Goolsbee said “prudence and patience”, saying officials should weigh the effects on the economy of a year-long campaign of tightening as well as the banking upheaval”.

Chicago Fed member Goolsbee also “Given how uncertainty abounds about where these financial headwinds are going, I think we need to be cautious.”

New York Fed member said John Williams said another increase before pausing was a “reasonable starting place”, adding that incoming data should be noted in the decision-making.