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Description

Is global CPI going to follow the US CPI slowdown?

Global Markets

Global CPI has leveled off and is slowing in DMs, but still rising in EMs

• Economies across the world have GDP of about US$90trn and an average CPI rate of 7.4%
• The developed world has GDP of US$52trn and CPI of 6.9%
• And the emerging world has GDP of US$38trn and a higher 8.2% CPI rate

World Jan. 2023 CPI was 7.4%, up 2.1ppts YoY; MoM DM continues to fall, while EM is rising

• DM Jan. 2023 CPI was 6.9%, up 1.5ppts YoY, but falling slightly MoM
• EM Jan. 2023 CPI was 8.2%, up 2.9ppts YoY, and is rising MoM

Key points

• Global CPI was 7.4% in January, up 2.1ppts YoY, but it was flat MoM
• Developed world CPI was 6.9%, up 1.5ppts YoY, but falling slightly MoM
• Emerging world CPI in January at 8.2%, up 2.9ppts YoY, and it rose MoM

Developed Markets Regions

CPI is contained in DM Americas, peaking in DM Europe, and rising in DM Asia

• With in the Developed Markets, DM Americas is the largest with US$25trn of GDP and 6.3% CPI
• Developed Europe has US$15trn of GDP and a higher 8.3% CPI
• Developed Pacific is smaller at US$8trn and has the lowest CPI of the developed regions at 5.1%

DM Americas CPI falling, DM Europe peaking, DM Asia rising

• 12 months ago, DM Americas had a 7.4% CPI which is now down to 6.3%, a 1.1ppts fall
• This means that CPI went from 2.1ppts above the global average to 1.1ppts below
• DM Europe rose from 4.4% 12 months ago to 8.3%, up 3.8ppts
• This means it went from 0.9ppts below to 0.8ppts above the global average
• CPI is racing up in DM Pacific from 1.5% 12 months ago to the current 5.1%, that’s a 3.6ppts increase
• It has gone from 3.8ppts lower than World CPI to 2.4ppts lower

Key points

• DM Americas 6.3% January CPI is down from 7.4% 12 months ago; and has now shifted from being 2.1ppts above the global average to 1.1ppts below
• CPI nearly doubled in DM Europe over the past 12 months from 4.4% to 8.3%, shifting from about 1ppts below to 1ppts above the global average
• CPI in the must smaller DM Pacific region raced up from 1.5% 12 months ago to the current 5.1%; despite that massive 3.6ppts increase, it remains about 2.4ppts lower than the global average

Emerging Markets

EM CPI rising in Asia, Middle East and Africa, and Frontier markets on fire

• EM Americas had a small GDP of US$3.8trn and CPI of 7.9%
• EM Asia had a massive GDP of US$25.7trn and 3.2% CPI
• EM Europe had US$3.9trn GDP and a massive 23% CPI
• EM Middle East and Africa had a small US$1.7trn GDP and a high 10.2% CPI
• Finally, Frontier markets had US$2.9trn GDP and 30% CPI

EM CPI rising in Asia, Middle East and Africa, and Frontier markets on fire

• EM Americas CPI was 7.9% in January, down slightly from 8.5% 12 months ago
• EM Asia CPI went from a tiny 1.9% 12 months ago to 3.2% and is still 4.3ppts below the World CPI
• Most notably, this has ticked up slightly MoM
• EM Europe CPI was 23% and over the past two months has been falling; though it is still 15.5ppts above the World average
• EM ME&A CPI was 10.2% compared to 3.7% 12 months ago. It has now risen to be 2.8ppts above the world average compared to 1.7ppts below 12 months ago
• Consumer prices are on fire in Frontier markets up 30% YoY in January; this is double where they were 12 months ago; CPI keeps rising MoM and is now 22.5ppts above the world average

Key points

• EM Americas CPI was 7.9% in January, down slightly from 8.5% 12