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Economy in Brief

U.S. CPI Total & Core Increases Ease
by Tom Moeller  March 13, 2018

Price inflation for both goods & services moderated last month. The Consumer Price Index gained 0.2% (2.2% y/y) in February following a 0.5% January rise. The index excluding food and energy prices increased 0.2% (1.8% y/y) after a 0.3% gain. Both of the latest readings matched consensus expectations in the Action Economics Forecast Survey.

The three-month annualized rate of increase in the total CPI picked up to 3.6%, while the three-month gain in the core price index accelerated to 3.1%.

Energy product price inflation moderated to 0.1% (5.7% y/y) from 3.0% in January as gasoline prices fell 0.9% (+12.5% y/y) after a 5.7% rise. Fuel oil prices declined 3.6% (+20.7% y/y) after a 9.5% gain. Other energy prices, however, firmed. Electricity prices rose 0.4% (2.2% y/y) after a 0.2% decline, while natural gas costs jumped 4.7% (3.8% y/y) following a 2.6% shortfall.

Food prices were fairly stable (+1.4% y/y) following two months of 0.2% increase. Fruit & vegetable prices fell 0.5% (+2.1% y/y) and reversed January's rise. Dairy product prices eased 0.3% (-1.9% y/y) and have been falling since late in 2014. Prices for meats, poultry & fish slipped 0.2% (+1.7% y/y) for the second straight month. Cereal & bakery product prices were off 0.1% (-0.2% y/y) following a 0.3% rise.

Prices for goods excluding food & energy ticked 0.1% higher (-0.5% y/y) after strengthening 0.4%. The latest rise occurred despite a 1.5% drop (-3.1% y/y) in appliance prices. Furniture & bedding prices rose, however, by 0.2% (-1.0% y/y) after a 0.4% rise. Apparel prices strengthened 1.5% (0.4% y/y) following a 1.7% jump. New vehicle prices declined 0.5% (-1.5% y/y) after a 0.1% dip, and used vehicle prices fell 0.3% (-0.1% y/y) after a 0.4% rise. Education & communication product prices fell 0.5% (-3.0% y/y) after a 0.8% gain.

Nonenergy services prices increased 0.2% (2.6% y/y) after two months of 0.3% improvement. Shelter prices rose 0.2% (3.1% y/y) for a second month as the owners equivalent rent of primary residences increased 0.2% (3.2% y/y), the weakest rise in three months. Medical care prices held fairly steady (1.8% y/y) following a 0.6% jump. Public transportation prices posted a 0.6% increase (-2.0% y/y) following three straight months of decline. Recreation prices improved 0.1% (2.5% y/y) for a second consecutive month. Education & communication services prices eased 0.2% (-1.7% y/y) after little change.

The consumer price data can be found in Haver's USECON database with additional detail in CPIDATA. The Action Economics survey figure is in the AS1REPNA database.

Consumer Price Index, All Urban Consumers (% chg) Feb Jan Dec Feb Y/Y 2017 2016 2015
Total 0.2 0.5 0.2 2.2 2.1 1.3 0.1
Total less Food & Energy 0.2 0.3 0.2 1.8 1.8 2.2 1.8
  Goods less Food & Energy 0.1 0.4 0.2 -0.5 -0.7 -0.5 -0.5
  Services less Energy 0.2 0.3 0.3 2.6 2.7 3.1 2.6
 Food -0.0 0.2 0.2 1.4 0.9 0.3 1.9
 Energy 0.1 3.0 -0.2 5.7 7.9 -6.6 -16.7
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