US PPI data leans to moderate increase in April CPI - Nomura

Analysts at Nomura noted that the PPI inflation of finished goods and services came in a little weaker than expected. 

Key Quotes:

"The detailed components of PPI suggest some downside risks to tomorrow's CPI report as both finished consumer food prices (-1.2% m-o-m) and residential electricity prices (- 0.5% m-o-m) dropped by more than we had expected."

"However, the performance of those two metrics as proxies of CPI's corresponding prices has not been good in recent months."

"We expect a moderate increase in April CPI. Our forecast for headline CPI inflation is 0.3% (+0.312%) m-o-m which translates into a 2.5% (2.544%) gain on a y-o-y basis."