Master the release date of the US CPI in 2024 and accurately grasp inflation signals

CPI Announcement Time and Market Influence

To gain an edge in the financial markets, the first step is to know when the US CPI is released. As the world’s most important inflation indicator, the US CPI directly influences Federal Reserve policy direction, which in turn impacts asset prices across various markets.

The release schedule for US CPI is simple: it is announced on the first business day of each month or the closest business day. However, note the difference between daylight saving time—during DST, it is released at 20:30 Taiwan time; during standard time, it is at 21:30.

Detailed CPI release schedule for 2024 (Taiwan time):

Why is the market so sensitive to CPI release times? Because CPI data is released before PCE data, which is the primary reference for Fed decision-making. Every Fed rate decision causes significant volatility in stocks, forex, and commodities. Therefore, being ahead of the CPI release time means grasping the market’s pulse.

Comprehensive Explanation of the Three Major Inflation Indicators

Investors often confuse CPI, Core CPI, and PCE. In fact, each has its focus, and understanding their differences enables more precise judgment.

CPI vs Core CPI: Including Food & Energy vs Excluding Food & Energy

US CPI includes price changes for all consumer items, but this also makes it susceptible to sharp fluctuations in food and energy prices. Core CPI is a “purified” version—excluding these volatile components—better reflecting underlying inflation trends.

In simple terms:

• CPI: panoramic view, more volatile, driven by oil and grain prices
• Core CPI: trend-focused, more stable, reflects true inflation pressure in services and goods

CPI vs PCE: Different weighting methods, entirely different roles

The difference lies in their calculation logic. CPI uses a Laspeyres weighting method, while PCE employs a chain-weighted approach. The result? PCE better captures consumers’ “substitution effect.” For example, after a surge in oil prices, consumers switch to other energy sources, automatically reducing the weight of crude oil in the shopping basket. This dynamic adjustment is precisely recorded by PCE.

Therefore:

• CPI: released earliest, market reacts most intensely
• PCE: released slightly later, more scientific, the Fed’s preferred indicator

Year-over-year vs Month-over-month: Long-term trend vs Short-term fluctuations

The YoY rate compares to the same period last year, eliminating seasonal factors and reflecting true price trends. The MoM rate is more affected by seasonal disturbances and is more volatile. Investors should focus on the YoY rate.

Key point: Investors focus on CPI YoY (the earliest released), while policymakers focus on PCE YoY (more authoritative).

Internal Composition and Key Analysis Points of US CPI

To accurately interpret CPI, it’s essential to understand its components. Taking December 2023 data as an example, the major categories and their share are approximately:

• Housing (including rent): 30~40% — the largest share, key observation target
• Food & beverages: 13~15% — second largest, not to be ignored
• Education & communication: 6~7%
• Energy: 6~8%
• Transportation services: 5~6%
• Medical & health insurance: 7~9%
• New cars: 3~5%
• Leisure & entertainment: 3~5%
• Used cars: 2~3%
• Clothing & apparel: 2~3%

Housing and food & beverages together account for over 45%, forming the core drivers of overall CPI. When analyzing CPI, priority should be given to these two categories’ price movements.

Two Major Factors Driving CPI Changes in 2024

Factor One: US Election Political Cycle

The 2024 US presidential election will inevitably influence prices. Regardless of party, candidates tend to overpromise economic policies during campaigns, often leading to increased government spending.

More importantly, amid escalating geopolitical conflicts, the US may accelerate de-globalization and implement more domestic protectionist policies. The result? Rising costs of imported goods, making it difficult for prices to decline smoothly.

Factor Two: Fed’s Rate Cut Pace and Magnitude

According to CME Group’s Fed Funds futures data, the market generally expects the Fed to cut rates by 6 basis points in 2024. This expectation reflects the market’s view that inflation will likely maintain a moderate downward trend throughout the year. But whether this materializes depends on actual CPI performance.

Three-Decade Economic Cycle Review: Four Major CPI Turning Points

History is the best teacher. Since the 1990s, US CPI has experienced four distinct waves of sharp fluctuations, each corresponding to major economic events:

First wave (July 1990 – March 1991): Savings & Loan crisis and Gulf War oil shock led to recession

Second wave (September 2000 – October 2001): Dot-com bubble burst and 9/11 attacks double blow

Third wave (January 2008 – June 2009): Subprime mortgage crisis triggered a severe recession

Fourth wave (March 2020 – present): COVID-19 pandemic impact — initial economic stagnation caused CPI to plummet rapidly, but massive Fed quantitative easing pushed CPI to a high point in June 2022. As global logistics recovered, CPI gradually declined from its peak.

Logistics as an underestimated CPI driver

The 2020 experience teaches us an important lesson: Global logistics conditions have a much larger impact on US inflation than previously thought. The recent Red Sea crisis again confirms this.

Houthi attacks on past merchant ships forced shipping companies to reroute around the Red Sea via the Cape of Good Hope. This directly increased freight costs on the Europe-Asia route — since early December 2023, freight rates have risen over 200%.

Although the impact is smaller than the second COVID wave at the end of 2020 or the Suez Canal blockage in 2021, regional logistics disruptions will ultimately translate into consumer price increases. This is a risk point that must be closely monitored.

CPI Trend Forecast for 2024: A “V-shaped” Pattern Throughout the Year

To forecast CPI in 2024, it’s necessary to consider the US economy’s growth potential. The latest IMF projections provide key references:

• Global GDP growth: revised upward to 3.1%
• US GDP growth: 2.1% in 2024, slowing to 1.7% in 2025
• Eurozone growth: revised downward to 0.9% (2024)
• Global inflation rate: expected to decline from 5.8% in 2024 to 4.4% in 2025

US economic growth ranks second among major economies, implying that US inflation is unlikely to fall sharply.

Combining these analyses, the CPI forecast for 2024 is:

First phase (Q1): Due to the downward correction of commodity prices in H1 2023, a low base effect will cause YoY CPI to bottom out in Q1.

Second phase (Q2): Continued decline in oil inventories supports oil prices; combined with the US election and Red Sea logistics crisis, CPI will rebound.

Third phase (H2): Downward trend reappears, but as base effects fade, the decline will slow gradually.

Overall judgment: CPI in 2024 will show a “low-high-low” curve, maintaining a moderate downward trend throughout the year, but without sharp drops. This will pose some upward pressure on US stocks.

What Should Investors Do

Knowing the CPI release time is just the first step; understanding the underlying data logic is more critical. Investors should establish the following cognitive framework:

1. CPI YoY is a leading market indicator, released earliest, with the greatest volatility, worth close attention
2. Housing and Food & Beverages together account for over 45%, key drivers of overall CPI
3. Global logistics conditions are underestimated by most investors but have significant influence
4. Fed rate cut expectations interact with CPI performance, determining asset price directions
5. The 2024 CPI is expected to decline throughout the year but may rebound in Q2, requiring dynamic position adjustments

In short, mastering CPI release timing and analysis framework is the core to understanding market volatility.