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Economy in Brief

U.S. CPI Increases Minimally; Core Prices Remain Tame
by Tom Moeller  June 12, 2019

Inflation continues to stay under wraps. The Consumer Price Index nudged 0.1% higher (1.8% y/y) during May following a 0.3% April rise. It was the smallest increase since January. The gain matched expectations in the Action Economics Forecast Survey. The CPI excluding food & energy also rose 0.1% (2.0% y/y) for the fourth consecutive month. A 0.2% gain had been expected.

Core goods prices continued to decline. The 0.1% easing (-0.2% y/y) pushed them lower for the fourth straight month. The decline was led by a 1.4% drop (+0.3% y/y) in used car & truck prices. Education & communications goods prices fell 0.5% (-6.0% y/y), off for the fifth straight month. Appliance prices eased 0.8% (+2.4% y/y) and medical care product prices fell 0.4% (-0.7% y/y). Apparel prices held steady (-3.1% y/y). Increasing by 0.1% (0.9% y/y) were new vehicle prices. Recreation product prices also rose 0.1% (-1.0% y/y) following a 0.3% decline, but video & audio product costs dropped 1.0% (-9.3% y/y). Prices of furniture & bedding rose 0.7% (2.4% y/y), recouping a 0.7% April decline.

Service prices improved 0.2% in April (2.7% y/y), following two months of 0.3% gain. Transportation services prices rose 0.1% (1.1% y/y), but the cost of public transportation surged 1.9% (0.9% y/y). Shelter costs rose 0.2% (3.3% y/y). Rents of primary residences increased 0.2% (3.7% y/y) and the owners' equivalent rent of primary residences gained a steady 0.3% (3.4% y/y). The cost of lodging away from home eased 0.1% (1.6% y/y). Recreation services prices declined 0.5% (+2.2% y/y) and the cost of medical care services rose 0.5% (2.8% y/y). Education & communication service costs increased 0.2% (1.3% y/y) as tuition costs gained 0.3% (3.5% y/y).

Lower energy prices held back the overall gain in the CPI with a 0.6% decline (-0.5% y/y). It followed two months of strong increase. Weakness was led by a 1.0% decline (-2.5% y/y) in natural gas prices and the cost of electricity fell 0.8% (-0.2% y/y). Gasoline prices eased 0.5% (-0.2% y/y) after three months of strong increase. Fuel oil costs weakened 0.3% (-0.8% y/y), after firming for three straight months.

Food prices rebounded 0.3% last month (2.0% y/y) after a 0.1% dip. Nonalcoholic beverage prices gained 1.2% (+2.2% y/y). Meat, poultry & fish prices surged 1.0% (1.4% y/y), but the increase was countered by a 2.2% decline in egg prices (-15.6% y/y). Fruit & vegetable prices fell 0.8% (+1.7% y/y). Dairy prices strengthened 0.7% (1.0% y/y) while cereal & bakery product prices rose 0.4% (2.2% y/y).

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) May Apr Mar Apr Y/Y 2018 2017 2016
Total 0.1 0.3 0.4  1.8 2.4 2.1 1.3
Total less Food & Energy 0.1 0.1 0.1 2.0 2.1 1.8 2.2
  Goods less Food & Energy -0.1 -0.3 -0.2 -0.2 -0.2 -0.7 -0.5
  Services less Energy 0.2 0.3 0.3 2.7 2.9 2.7 3.1
 Food 0.3 -0.1 0.3 2.0 1.4 0.9 0.3
 Energy -0.6 2.9 3.5 -0.5 7.5 7.9 -6.6
 
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