JPMorgan Analysis Team Says It Makes More Sense To Bet On A Low US CPI Figure Than A High Number.

Traders hoping to profit from a surprise figure in Wednesday's consumer inflation data may be better positioned to see the data come in below estimates, according to JPMorgan Chase & Co.'s trading desk.
While the consensus estimate for the consumer price index for June is for a 3.1% annualized pace, the bank team, including Andrew Tyler, sees an 80% chance of the data coming in line with or below the forecast.
In two contrasting risk scenarios where the CPI reading creates a market shock, the team sees a 10% chance for inflation to slow sharply and a 20% chance for it to hit 3.3 and above.
As I've been talking about for a while, Tyler of JP Morgan and his colleagues said in an email to clients this week, "We think this data puts the market closer to Goldilocks, where there's economic growth, earnings growth and normalized inflation." Even if the bull market arguments didn't necessarily require a pause at the July Fed meeting. Also, it definitely increases the upside potential in the event of a pause.
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