Main PageOctober 14, 2026

What is the distribution of forecasts for the US CPI?

The ranges of estimates are important in terms of market reaction because when the actual data deviates from the expectations, it creates a surprise effect. Another important input in market’s reaction is the distribution of forecasts.

In fact, although we can have a range of estimates, most forecasts might be clustered on the upper bound of the range, so even if the data comes out inside the range of estimates but on the lower bound of the range, it can still create a surprise effect.

CPI Y/Y

  • 4.1 (2%)
  • 3.8 (2%)
  • 3.7 (33%)
  • 3.6% (50%) – consensus
  • 3.5% (7%)
  • 3.3% (2%) 
  • 3.2% (2%)
  • 3.1% (2%)

CPI M/M

  • 0.7% (4%)
  • 0.6% (74%) – consensus
  • 0.5% (19%)
  • 0.3% (3%)

Core CPI Y/Y

  • 2.5% (67%) – consensus
  • 2.4% (30%)
  • 2.3% (3%)

Core CPI M/M

  • 0.3% (18%)
  • 0.2% (82%) – consensus

We can see there’s a big dispersion in the forecasts for the headline CPI, but the good news is that the market won’t care about that because a jump in headline inflation is widely expected due to higher energy prices. The focus will be mainly on the Core CPI M/M measure, as Fed members have been focusing on the monthly pace of core inflation to determine how many rate hikes will be needed and how quickly they should tighten policy.

The probabilities for a rate hike in October currently sit around 21% because traders have been waiting for the CPI data to completely rule out a hike at the upcoming meeting despite the pushback from Fed members. I feel like an uptick to 0.3% might not be enough for the market to fully expect a hike in October, but a jump to 0.4% should definitely do it. In such a case, I would expect the market to go into risk-off with the stock market falling, the US dollar rallying and precious metals sinking.

An in-line or even lower than expected figure, on the other hand, will likely provide a short-term relief, giving the stock market and precious metals a boost while weighing on the US dollar. The data won’t change the bigger picture, though, as the inflationary pressures from the Middle East crisis will persist. 

This article was written by Giuseppe Dellamotta at investinglive.com.