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Economy in Brief

U.S. Consumer Prices Are Unchanged Again; Core Price Gain Slows Further
by Tom Moeller  August 15, 2012

Consumer prices were unchanged last month as they were in June. A 0.2% increase was expected. The year-to-year increase fell to 1.4%, down from its peak of 3.9% last September. A 0.1% increase (2.1% y/y) in prices less food & energy was down from four consecutive 0.2% monthly gains. Another 0.2% increase was expected for July. The y/y increase slowed to 2.1% and the three month gain of 2.0% (AR) was its weakest since February.

Energy prices fell another 0.3% (-5.1% y/y) though gasoline prices inched up 0.3% (-5.5% y/y). Electricity prices were off 1.3% (-1.3% y/y) and fuel oil costs fell a not seasonally adjusted 0.5% (5.6% y/y). Natural gas prices were 0.2% lower (-12.7% y/y). Food prices ticked up 0.1% (2.3% y/y) as meat, poultry & fish costs rose 0.3% (3.2% y/y) while fruits & vegetable prices fell 0.3% (-0.7% y/y). Elsewhere, cereals & bakery products costs rose 0.3% (2.9% y/y) but dairy product prices declined 0.5% (-0.2% y/y).

For goods alone, prices less food & energy were unchanged. The 12-month increase fell further to 1.2%, its least since April of last year. Apparel prices rose 0.2%. The 3.0% y/y gain was off its high but remained well above the 0.5% decline in 2010. Furniture & bedding costs increased 0.4% (1.8% y/y) but  appliance prices fell 0.5% (+2.4% y/y). New motor vehicle prices slipped 0.1% (0.8% y/y).

The minimal 0.1% increase (2.5% y/y) in core service prices reflected another 0.1% rise (2.1% y/y) in shelter costs (32% of the CPI). Owners equivalent rent of primary residences rose 0.2% (2.0% y/y). The y/y increase compares to a low of -0.3% in early 2010. Education costs rose 0.5% (4.2 y/y) while medical care service prices increased 0.3% (4.4% y/y). Public transportation prices declined 1.5% (+0.1% y/y) and recreation services prices ticked up 0.1% (3.4% y/y).

The consumer price data is available in Haver's USECON database while detailed figures can be found in CPIDATA. The expectations figure is from Action Economics and is found in the AS1REPNA database.

Consumer Price Index(%) Jul Jun May Jul Y/Y 2011 2010 2009
Total 0.0 0.0 -0.3 1.4 3.1 1.6 -0.3
Total less Food & Energy 0.1 0.2 0.2 2.1 1.7 1.0 1.7
  Goods less Food & Energy 0.0 0.2 0.2 1.2 1.3 1.1 1.3
  Services less Energy 0.1 0.2 0.2 2.5 1.8 0.9 1.9
 Food 0.1 0.2 0.0 2.3 3.7 0.8 1.8
 Energy -0.3 -1.4 -4.3 -5.1 15.2 9.6 -18.2
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