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Economy in Brief

U.S. CPI Holds Steady; Core Prices Edge Higher
by Tom Moeller  October 10, 2019

The Consumer Price Index remained unchanged during September (1.7% y/y) following a 0.1% uptick in August. Expectations had been for a 0.1% rise in the Action Economics Forecast Survey. The CPI excluding food & energy rose 0.1% (2.4% y/y) following three straight months of 0.3% increase. A 0.2% m/m gain had been expected.

Holding back consumer price inflation last month was a 1.4% decline (-4.8% y/y) in energy costs. It was the fourth decline in five months. Gasoline prices fell 2.4% (-8.2% y/y), also the fourth decline in five months. Fuel oil prices eased 0.8% (-8.5% y/y) after a 0.9% decline. Electricity prices held steady (0.7% y/y) after falling 0.3%. Natural gas prices fell 0.7% and were off 2.7% y/y.

Consumer goods prices excluding food & energy also were weak and declined 0.3% following two months of 0.2% increase. The y/y rise of 0.7% compared to a low of -1.0% during October 2017. Education & communications goods prices declined 1.2% (-4.7% y/y) after a 0.9% rise. Medical care goods prices fell 0.6% (-0.3% y/y) and reversed the prior two months' gain. Apparel prices fell 0.4% after a 0.2% rise. The y/y rise eased to -0.3%. Prices of new vehicles eased 0.1% (+0.1% y/y), off slightly for the third consecutive month. To the upside, household appliance prices surged 1.3%, but the 1.0% y/y rise compared to 6.8% y/y in February. Used car & truck prices rose 0.5% (4.1% y/y), strong for the fourth straight month. Furniture & bedding prices improved 0.3%. The 2.3% y/y increase compared to -0.7% y/y as of August last year. Recreation goods prices rose 0.2% for a second straight month. Their -0.2% y/y change compared to -4.0% y/y in October 2016.

Services prices increased 0.3% (2.9% y/y) for the fourth consecutive month. The cost of shelter rose 0.3% (3.5% y/y). The owners' equivalent rent of primary residences also rose 0.3% and a steady 3.4% y/y. Rents of primary residences strengthened 0.4% (3.8% y/y), the largest gain in three months. The cost of lodging away from home rebounded 2.1% (5.0% y/y) and reversed the August decline. Medical care services prices strengthened 0.4% (4.4% y/y) following a 0.9% gain. Recreation services costs held steady (1.6% y/y), though video & audio services prices gained 0.5% (1.6% y/y). Education & communication costs rose 0.1% and an easier 0.9% y/y. The cost of public transportation rose 0.2%. The 1.7% y/y increase compared to a 1.7% decline in prices last year.

Food prices rose 0.1% (1.8% y/y) in September after holding steady for three straight months. Dairy product prices increased 0.2% (1.4% y/y) but meat, poultry & fish prices eased 0.1% (+0.9% y/y). Fruit & vegetable prices declined 1.0% (-0.4% y/y) while cereal & bakery product costs improved 0.5% (1.3% y/y). Egg prices surged 6.5% (-8.1% y/y). Nonalcoholic beverage prices edged 0.1% higher (1.3% 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) Sep Aug Jul Sep Y/Y 2018 2017 2016
Total 0.0 0.1 0.3 1.7 2.4 2.1 1.3
Total less Food & Energy 0.1 0.3 0.3 2.4 2.1 1.8 2.2
  Goods less Food & Energy -0.3 0.2 0.2 0.7 -0.2 -0.7 -0.5
  Services less Energy 0.3 0.3 0.3 2.9 2.9 2.7 3.1
 Food 0.1 0.0 0.0 1.8 1.4 0.9 0.3
 Energy -1.4 -1.9 1.3 -4.8 7.5 7.9 -6.6
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