---
title: Bonds, stocks, gold and cryptos rally following cooler-than-expected US inflation data.
description: "May headline CPI slowed by 10bps to 3.3% YoY vs 3.4% expected. Core slowed 20bps to 3.4% vs 3.5% expected. Super Core CPI TURNED NEGATIVE (!) -0.05% MoM - its first drop since Sept 2021 (but that left the YoY level still above 5.0%). \n\nDetails: \nCPI data for May 2024\n• Inflation was softer than expected in May: headline 0.0% MoM vs +0.1% expected; “core” inflation +0.2% MoM (+0.163% unrounded) vs +0.3% expected\n• As a result, the yearly headline inflation rate is down to +3.3% (after +3.4% in April) and the “core” inflation rate is down to +3.4% (+3.6% in April), its lowest level in three years. \n• Inflation is still above the Fed’s target of 2% but the trend toward slower inflation has resumed, after the upside surprises of the first quarter of the year. \n- Housing (shelter) inflation remains firm, but CPI inflation excluding shelter (+2.1% YoY%) is now back (almost) at the level targeted by the Fed.\n- Inflation in services, that has been strong in the previous months, is finally slowing down (+0.2% in May vs +0.4% in April and +0.5% in March).\n- Prices of durable and nondurable goods have declined in May (-0.5% and -0.4% respectively).\n• Those data confirm our scenario of a gradual disinflationary trend at play in the US, as labor market tensions ease and consumer demand loses some momentum. \n\nImpact on the hashtag#Fed\n• Following the release, and ahead of the Fed’s meeting tonight, the probability of a Fed rate cut in September has increased to 62%, \n• A Fed rate cut at the November meeting (two days after the US Presidential elections) is now fully priced in. \n• Future markets also fully price a second rate cut at the December meeting.\n• After the FOMC meeting tonight (no rate cut expected), Fed’s members will update their economic and rate projections. \n• Those CPI data are probably a relief for the Fed and will likely prevent hawkish surprises and significant revisions to the upside on the expected path of Fed Fund rates in 2024 and 2025.\n\nSource: HolgerZ, Bloomberg"
---

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# [Bonds, stocks, gold and cryptos rally following cooler-than-expected US inflation data.](https://blog.syzgroup.com/syz-the-moment/bonds-stocks-gold-and-cryptos-rally-following-cooler-than-expected-us-inflation-data)

 Written by [Charles-Henry Monchau, CFA, CMT, CAIA](https://blog.syzgroup.com/syz-the-moment/author/charles-henry-monchau) | Jun 12, 2024, 2:16:54 PM

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