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Economy in Brief

U.S. CPI Jumps With Energy Prices; Inflation Tame Elsewhere
by Tom Moeller  July 16, 2013

All of a sudden the cost of living has jumped. The consumer price index surged 0.5% in June (1.8% y/y) after a 0.1% May uptick. It was the firmest rise since February and beat expectations for a 0.3% increase. Prices excluding food and energy gained 0.2% (1.6% y/y) for the seco+nd straight month and matched expectations.

A 3.4% rise (-0.8% y/y) in energy prices led the CPI higher last month. It reflected a 6.3% gain (2.8% y/y) in gasoline prices, the first rise since February. Electricity costs increased 0.2% (1.9% y/y). To the downside, fuel oil prices slipped 0.5% (+1.8% y/y) and natural gas costs were off 0.4% (+11.7% y/y).

A 0.2% rise (1.4% y/y) in food prices reflected a 1.3% jump (2.6% y/y) in milk costs. Also, poultry prices gained 1.0% (5.5% y/y) and meat prices were up 0.3% (0.8% y/y). Beverage prices rose 0.2% (-0.9% y/y) but fruit and vegetable prices slipped 0.1% (+1.0% y/y).

Prices for goods less food and energy gained 0.2% (-0.2% y/y) following several months of having been unchanged. Apparel prices led the way higher with a 0.9% jump (0.7% y/y) while medical care goods prices rebounded 0.5% (-0.1% y/y). New car and truck prices gained 0.3% (1.2% y/y). Furniture and bedding costs rose 0.2% (-0.5% y/y) and home appliance prices also increased 0.2% (-1.9% y/y). Recreation goods prices were off 0.6% (-1.8% y/y).

Core services prices increased 0.2% (2.3% y/y). Medical care service prices rose 0.4% (2.8% y/y). Shelter costs (32% of the CPI) gained 0.2% (2.3% y/y) while owners equivalent rent of primary residences increased 0.2% (2.2% y/y). Public transportation prices fell 0.9% (+3.6% y/y) and transportation services costs slipped 0.1% (+2.5% y/y).

The Path of Wage Growth and Unemployment from the Federal Reserve Bank of San Francisco can be found here.

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 (%) Jun May Apr Jun Y/Y 2012 2011 2010
Total 0.5 0.1 -0.4 1.8 2.1 3.1 1.6
Total less Food & Energy 0.2 0.2 0.1 1.6 2.1 1.7 1.0
  Goods less Food & Energy 0.2 0.0 0.0 -0.2 1.3 1.3 1.1
  Services less Energy 0.2 0.2 0.1 2.3 2.4 1.8 0.9
 Food 0.2 -0.1 0.2 1.4 2.6 3.7 0.8
 Energy 3.4 0.4 -4.3 3.2 0.9 15.2 9.6
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