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Economy in Brief

U.S. Consumer Price Index & Core Prices Hold Steady During October
by Tom Moeller  November 12, 2020

• Retail price inflation decelerates y/y.

• Goods prices firm y/y, while price gains in services moderate.

Consumer prices continue to be well-behaved. The Consumer Price Index held steady (1.2% y/y) during October following a 0.2% September rise and even stronger increases during the prior three months. A 0.1% improvement had been expected in the Action Economics Forecast Survey. The CPI excluding food & energy also was unchanged (1.6% y/y) last month, after having risen between 0.2% and 0.6% in each of the prior four months. A 0.2% gain had been expected.

Goods prices excluding food & energy eased 0.2% after a 0.8% September rise and a 1.0% August improvement. The y/y increase of 1.2% compares to y/y price declines from January through July. Stronger used car & truck prices account for much of the acceleration, rising 11.5% y/y. They eased 0.1%, however, during October. Home appliance prices rose 0.4% last month and the 4.8% y/y gain was improved from -2.1% in January. New vehicle prices rose 0.4% last month and 1.5% y/y, up from y/y declines during Q2. Apparel prices strengthened 1.2% but fell 5.5% y/y. Elsewhere, goods prices declined. Household furnishings costs eased 0.5% last month. They strengthened 1.9% y/y after declining early this year. Medical care product costs were off 0.8% and fell 0.8% y/y, down from a 2.5% increase during all of last year. Recreation goods prices declined during the last two months and fell 1.3% y/y. Prices for education & communication goods weakened 0.2% (-5.0% y/y) following a 2.5% decrease.

Services prices improved 0.1% last month after holding steady in September. The 1.7% y/y increase has slowed significantly from last year's rise. Education & communication prices rose 0.1% and rose a strengthened 2.7% y/y. Tuition costs held steady (1.3% y/y). Medical care service prices declined 0.3% and the 3.7% y/y rise compared to 6.0% y/y as of June. Shelter costs rose 0.1% and by a greatly lessened 2.0% y/y. The owners' equivalent rent of primary residences also increased by a greatly reduced 2.5% y/y. To the upside, recreation services prices improved 0.7% (2.6% y/y) following two months of 0.5% increase. The cost of public transportation jumped 2.6% but fell 14.1% y/y.

Energy product prices edged 0.1% higher (-9.2% y/y) following three months of strong increase. Electricity prices rose 1.2% (1.3% y/y) following a 0.9% rise. Gasoline prices slipped 0.5% (-18.0% y/y) after a 0.1% uptick while fuel oil prices declined 0.3% (-28.2% y/y) after falling 5.3%. The cost of natural gas fell 0.7% (+1.8% y/y) after jumping 4.2% in September.

Food prices rose 0.2% and by a strengthened 3.9% y/y. Food-at-home prices edged 0.1% higher (4.0% y/y) after falling for three straight months. The increase reflected a 1.5% gain (3.7% y/y) in egg prices. Meat, poultry & fish prices rose 0.3% (6.2% y/y) after falling for three consecutive months. Cereal & cereal product prices rose 0.1% and an increased 2.8% y/y while bakery product prices rose 0.3% (NSA, 3.1% y/y). Fruit & vegetable prices rose 0.1% (2.6% y/y), up from a 1.3% decline last year. Dairy & dairy product prices declined 0.9% (+3.8 y/y), up from a 2.4% rise last year. Nonalcoholic beverage prices eased 0.1% (+4.4% y/y). Prices of food away from home rose 0.3% (NSA) and by a strengthened 3.9% y/y.

The Consumer Price Index 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) Oct Sep Aug Oct Y/Y 2019 2018 2017
Total 0.0 0.2 0.4 1.2 1.8 2.4 2.1
Total less Food & Energy 0.0 0.2 0.4 1.6 2.2 2.1 1.8
  Goods less Food & Energy -0.2 0.8 1.0 1.2 0.2 -0.2 -0.7
  Services less Energy 0.1 0.0 0.2 1.7 2.8 2.9 2.7
 Food 0.2 0.0 0.1 3.9 1.9 1.4 0.9
 Energy 0.1 0.8 0.9 -9.2 -2.1 7.5 7.9
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