Recent Updates

  • Croatia: Core CPI, Consumer Confidence (Sep)
  • Canada: Wholesale Trade (Aug), Nonresidential Building Construction (Q3)
  • Canada Regional: Wholesale Trade by Province (Aug)
  • Morocco: CPI (Sep)
  • Palestine: Public Debt (Sep-Prelim)
  • Bangladesh: CPI (Sep)
  • Luxembourg: Employment and Unemployment (Sep)
  • Ukraine: Average Sales Prices of Agricultural Products (Sep); Trade by Commodity, Import and Export Indexes (Aug), HPI (Q3)
  • more updates...

Economy in Brief

U.S. CPI Remains Tame With Across-the-Board Weakness
by Tom Moeller August 13, 2010

Not-with-standing a moderate blip in energy prices, consumer price inflation remained under control last month. The July Consumer Price Index increased 0.3% (1.3% y/y) following three consecutive months of slight decline. During the first seven months of this year prices rose at a 0.3% annual rate. The latest figure was a bit higher than Consensus expectations for a 0.2% increase.

First and foremost, a 2.6% rise in energy prices reversed the June drop. The latest was driven by a 4.6% gain (7.4% y/y) in gasoline prices after five consecutive months of decline. Natural gas & electricity prices also rose 0.8% (1.8% y/y) but fuel oil prices fell 1.6% (+13.5% y/y). Food & beverage prices also were tame and roughly unchanged for the third consecutive month. Fruit & vegetable prices fell another 1.9% (-1.8% y/y) though prices for meats, poultry, fish & eggs rose 0.3% (3.6% y/y) and dairy prices rose 0.5% (3.0% y/y). The cost of eating out remained tame in this subdued spending environment and slipped modestly (+1.1% y/y).

Core consumer pricing power also remained under wraps. Another 0.2% increase in prices less food & energy left them up just 1.0% y/y, nearly the weakest since the early-1960s. A 0.1% July uptick had been expected. Year-to-date prices rose at a 0.7% annual rate. Core goods prices again rose 0.2% m/m (1.0% y/y) and at a 0.3% annual rate so far in 2010. Pricing strength was led last month by a 1.6% increase (7.4% y/y) in tobacco prices. Apparel prices increased 0.6% (-0.2% y/y) while prices of home furnishings &operation slipped 0.1% (-3.1% y/y). New & used motor vehicles prices again increased 0.3% (4.3% y/y) though most of that twelve-month strength occurred at the end of last year.

Core services prices rose 0.1% (1.0% y/y) for the fifth month in the last six. Another 0.4% gain (4.8% y/y) in education costs led the increase. Shelter costs rose 0.1% (-0.4% y/y) as owners equivalent rent of primary residences, a measure not equivalent to other house price measures, also ticked 0.1% higher (-0.2% y/y). The slight y/y decline in this measure was the weakest reading since the series' start in 1983. Medical care services prices slipped marginally (+3.2% y/y).

The chained CPI, which adjusts for shifts in consumption patterns, was about unchanged m/m and rose 1.0% year-to-year. Chained prices less food & energy also were about unchanged and up only 0.6% y/y.

The consumer price data is available in Haver's USECON database while detailed figures can be found in the CPIDATA database.

Are some prices in the CPI more forward looking than others? We think so. from the Federal Reserve Bank of Cleveland can be found here.

Consumer Price Index (%) July June May July Y/Y 2009 2008 2007
Total  0.3 -0.1 -0.2 1.3 -0.3 3.8 2.9
Total less Food & Energy 0.1 0.2 0.1 1.0 1.7 2.3 2.3
  Goods less Food & Energy 0.2 0.2 0.1 1.0 1.3 0.1 -0.4
  Services less Energy 0.1 0.1 0.1 1.0 1.9 3.1 3.4
  Energy 2.6 -2.9 -2.9 5.2 -18.1 13.7 5.6
  Food & Beverages -0.0 -0.0 0.0 0.9 1.9 5.4 3.9
Chained CPI: Total (NSA)  -0.0 -0.2 0.1 1.0 -0.1 3.7 2.5
  Total less Food & Energy  -0.0 0.0 -0.0 0.6 1.5 2.0 1.9
close
large image