Analysts at Nomura offered a review of the US CPI that came in a little lower than our forecast for December. Key Quotes: "We think that residual seasonality, which tends to lower core CPI in December, played some role in the deceleration. Given this deceleration in December, we might see some rebound in core inflation in January." "Otherwise, we think that the lagged effect of the stronger dollar and lower energy prices will offset the positive impact from the recent tightening of labor markets. We expect a 0.17% m-o-m (+2.1% y-o-y) gain in core CPI in January (Consensus: 0.2% m-o-m, 2.1% y-o-y). We forecast that energy prices declined in January." "As such, we expect headline prices to fall by 0.11% m-o-m (+1.2% y-o-y) (Consensus: -0.1% m-o-m, 1.3% y-o-y). Note that the annual revisions to CPI will be released on 17 February, as the BLS recalculates seasonal factors. Therefore, our forecast is subject to change." For more information, read our latest forex news.