April CPI figures will be released tonight! The expected 3.7% is a near three-year high, indicating Trump's inability to curb inflation.

The U.S. Department of Labor will release the April Consumer Price Index (CPI) at 8:30 PM Taiwan time tonight (8:30 AM Eastern Time). The FactSet consensus forecast is for an annualized increase of 3.7% and a monthly increase of 0.6%, while the core CPI is expected to increase by 2.7% annually and 0.3% monthly. If the actual figure falls close to the forecast, it will be the largest annualized increase since September 2023, and the second consecutive month that it has far exceeded previous optimistic market expectations.

The March CPI has already dealt a heavy blow to the market, with a monthly increase of 0.9%, nearly three times the 0.3% increase in February. Energy prices accounted for this surge, rising 10.9% and gasoline 21.2%, with these single items contributing approximately 75% of the monthly increase. The near-historic rise in US oil prices over the past month is likely the main reason for this high CPI.

The effects of tariffs are recorded for the first time.

The key focus for April's CPI is not just oil prices; the effects of the new wave of tariffs implemented on April 2nd will be reflected in the data for the first time, and the pressure of rising import prices is beginning to pass from the supply chain to the consumer end. Vanguard predicts that core services will increase by 0.41% month-on-month, with rebounds in healthcare and airfare prices also contributing to the increase.

The Federal Reserve kept interest rates unchanged at 3.50%-3.75% at its April 29 meeting, with the next FOMC meeting scheduled for June 16-17.

Polymarket prices the probability of no rate cuts throughout 2026 at 57.8%, and the probability of only one 25bp rate cut at 19.5%. Bank of America and Goldman Sachs have both postponed their rate cut expectations to 2027.

BTC opened at $82,164 on May 11th, its strongest opening this year, but subsequently fell back to around $80,860. The S&P 500 closed at 7,399 (+0.84%), and the 10-year US Treasury yield was 4.38%. If the CPI figure is higher than expected, upward pressure on yields will directly suppress risk assets.

Trump has no solution to inflation

Two consecutive months of strong inflation data have increased the political risk for Trump and the Republicans ahead of the November 3 midterm elections. One of Trump's core campaign promises for his 2024 return to the White House was to reduce inflation, but a recent CNBC poll shows his approval rating for economic policy has fallen to 37-39%, the lowest in his two terms, while his approval rating for handling inflation is even lower at only 30%.

The anger of Americans over rising oil prices is translating into voting pressure. "People are now realizing that the previous talk of lowering the cost of goods and services was just a fairy tale," one voter said . "They were barely floating on the surface, their noses just above water, but now they've been pulled underwater and can't even catch their breath."

The figures released tonight are also a barometer for the November midterm elections.

Related reports

The Federal Reserve estimates that the US April CPI will rise by 3.56%; analysts warn that if Bitcoin fails to break through the 200-day EMA, it could fall to $70,000.

Bitcoin traded sideways at $81,000, 80,000 people were liquidated, resulting in losses of $220 million; the market is facing three major hurdles: CPI and the Trump-Xi meeting.

WSJ reports: Trump advisors urgently call for an end to the Iran war; "high oil prices ruined the midterm elections"; markets closely watch inflation and Fed signals.