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Posted July 18, 2025 at 12:02 pm
My forecast for this Monday’s Hong Kong Consumer Price Index (CPI) is 1.8% and I believe the “Yes” answer at the 1.4% threshold is undervalued, costing just $0.72. I think there’s less than a 10% chance that it comes in at 1.4% or under, which is what’s required for “Team Yes” to lose here. For context, the median estimate is at 2%.
Consumer sentiment revisions are typically marginal and below 1. Today’s flash reading arrived at 61.8 and there’s a minimal chance of a 3.8 point downside adjustment or 2.3 northward edit two Fridays from now for the final reading, which is what this forecast contract is based on. In light of the historical trends, I like buying the “Yeses” at 56 and 58 and the “Nos” at 64 and 66 which are going for $0.95, $0.87, $0.88 and $0.96.
The Conference Board’s Consumer Confidence Index hasn’t been at or below 84 since May 2014 and I believe the “Yes” answer at that threshold is undervalued at just $0.94. Not even the depths of the pandemic produced a figure that low.
Source for Images: ForecastEx
Note: Prices are highest bids as of the morning of July 18, 2025. Red circles around the thresholds were inserted by J. Torres to highlight his preferred “Yes” and “No” answers throughout different levels.
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