Forward-Looking Tonight's CPI: Strong Inflation Raises Trump Political Risk, Fed Rate Hold Expectation Further Solidifying

BlockBeats News, May 12, the US Department of Labor will release the US April CPI data at 8:30 pm Beijing time tonight. The market widely expects a 3.7% increase, which will be the largest since September 2023, further strengthening the market's expectation that the Fed will keep rates unchanged for a period of time.

Two consecutive months of strong inflation data will increase the political risk for Trump and the Republicans before the November midterm elections. Trump's biggest campaign promise before returning to the White House in 2024 included lowering inflation, but now the American people are disappointed in Trump's handling of the economy, with many blaming him for the rise in oil prices. "People now realize that the previous claims of reducing the cost of goods and services were just a fairy tale. They were originally barely staying afloat, with only their noses above water, but now they are being pulled underwater, unable to catch a breath."

According to PolyBeats monitoring, on the prediction market Polymarket, there is a 46% probability of the April CPI data being 3.7% and a 35% probability of it being 3.5%.