Monthly inflation figures have been really low in the US in the last few years. The weakening of the global economy last year surely didn’t help matters. But, at least it was positive; now, with the spread of coronavirus and the Oil war between Russia and Saudi Arabia, inflation was going to turn negative.

The CPI (consumer price index) inflation report was released a while ago and it turned negative indeed in March.

US March CPI Inflation Report

• March CPI +1.5% Year-on-Year
• February stood at +2.3%
• Consensus estimate was +1.6%
• Headline CPI  MoM at-0.4% vs -0.3% expected
• Headline CPI ex. food and energy at +2.1% vs +2.3% expected
• Core CPI ex. food and energy -0.1% vs +0.1% expected
• Real average weekly earnings +0.7% y/y vs +0.7% prior
• Real average hourly earnings +0.6% y/y vs +0.6% prior

So, inflation has turned negative in March, but if OPEC+ reaches an agreement and cuts production by around 10 million barrels/day as anticipated, then inflation should pick up eventually. The coronavirus shut down should help increase prices for certain products, especially pharmaceuticals and probably food as well.