US consumer prices rose 0.4% month-over-month and 3.4% year-over-year in August, according to the latest Consumer Price Index inflation report. DWS Group head of fixed income George Catrambone and RBC Capital Markets head of US economics Michael Reid discussed how Federal Reserve voting members may be reacting to the data ahead of next week's September FOMC meeting. Catrambone said officials including Lori Logan, Beth Hammock and Neil Kashkari have been warning of a reacceleration in inflation, and that the market appears to be pricing in a rate hike. He cautioned that equities sit about 3% off all-time highs and that a curve that has moved from roughly 3.50% and 3.95% to 4% and 5% could weigh on consumers, growth and eventually stocks. The discussion also flagged consumer stress signals including non-mortgage personal interest payments, normalized credit card delinquencies, credit utilization and a falling personal saving rate now below 3%.
DWS Group GmbH & Co. KGaADWS fixed-income head George Catrambone is quoted discussing the hot CPI print and hawkish Fed, but the article gives no company-specific impact on DWS.
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Royal Bank of Canada