There is a growing chance that this CPI report will be accidental. US equity futures are up 0.3% in the last four days. There is speculation that the upcoming Biden speech, which might occur following the CPI data, will be an announcement of victory.
Because of this, the market is anticipating a soft CPI and even meme stocks are starting to run. There is a lot of commentary on the CPI report, which suggests that risk assets will likely increase after a soft CPI.
A risk factor has been created around the prior CPI reporting occasions, as the fear has dissipated. That led to a tremendous 5.5% rally when the data cooled. It is time to be certain that inflation is declining in the months ahead, but betting on whatever CPI number comes out will most certainly result in disaster.