US inflation seen picking up in July with bigger accelerations in the months ahead – UBS | investingLive

The firm is forecasting that core CPI is seen at +0.35% m/m (vs +0.32% m/m estimate) and +3.11% y/y (vs +3.00% y/y estimate) in July. Among all the analysts, UBS has the highest estimates as they see inflation pressures picking up from now all the way through to the autumn season.

UBS is anticipating tariffs impact to have a say in all this as they forecast core goods inflation to be at +0.38% m/m. That follows a +0.20% m/m reading in June. And the firm is locking in even stronger readings for the months ahead, with +0.60% in August, +0.76% in September, and +0.73% in October.

Besides that, UBS is also expecting core services inflation to accelerate in July to +0.35% m/m. And that follows from a +0.25% m/m reading in June.

On this, they are citing a rebound in prices for airfares and lodging away from home. For some context, the former was seen down 0.11% with the latter down 2.89% back in June. UBS is anticipating a 1.0% monthly increase (vs +1.50% estimate) in prices for airfares and 0.90% increase (vs +0.06% estimate) for lodging away from home.