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Economy in Brief

U.S. Consumer Price Index Marches Higher in November
by Tom Moeller  December 10, 2021

• Annual gain in core prices stays strong.

• Core goods prices approach double-digit increase y/y, while services prices accelerate.

• Energy prices surge again; food prices are strong.

Price inflation remains robust. The Consumer Price Index rose 0.8% during November and 6.8% y/y, after increasing an unrevised 0.9% in October. It was the largest y/y increase since June 1982. A 0.7% rise had been expected in the Action Economics Forecast Survey.  The CPI excluding food & energy increased an expected 0.5% last month following a 0.6% October gain. The 4.9% y/y increase was the strongest since June 1991.

During the last six months, the CPI overall has risen at a 7.8% annual rate, up from a 1.2% gain during all of last year. The core CPI rose at a 5.5% rate during the last six months, compared to 1.7% in 2020.

Goods prices excluding food & energy surged 0.9% in November (9.4% y/y) after rising 1.0% in October. Used car & truck prices strengthened 2.5% (31.4% y/y) for the second straight month. The cost of new vehicles rose 1.1% (11.1% y/y) and have risen strongly in each of the last seven months. Apparel prices strengthened 1.3% (5.0% y/y) following no change in October. Household furnishings prices rose 0.7% (6.0% y/y), the fourth consecutive month of strength, but prices of appliances eased slightly (+4.9% y/y) after slipping 0.1% in October. Recreation product prices rose 0.3% (3.9% y/y) after gaining 0.4%, but the cost of televisions fell 1.4% (+7.9% y/y). Medical care product prices edged 0.1% higher (0.2% y/y) after a 0.6% gain. Education & communication product costs declined 1.0% last month (+0.9% y/y) after falling 0.5% in October.

Services prices rose a steady 0.4% last month (3.4% y/y). Shelter prices increased 0.5% (3.8% y/y), the same as in October. Owners' equivalent rent of primary residences improved 0.4% (3.5% y/y) for the third straight month. Rents of primary residences gained 0.4% (3.0% y/y) last month as they did in October while the cost of lodging away from home surged 2.9% (22.2% y/y) after rising 1.4%. Recreation services prices eased 0.5% in November (+2.8% y/y) following a 0.8% rise. Transportation services prices rose 0.7% in November (3.9% y/y) after gaining 0.4% in October, but public transportation costs surged 3.0% (-0.6% y/y) after falling 0.7%. Medical care services rose 0.3% (2.1% y/y) after rising 0.5% in October. Education & communication costs held steady last month (1.7% y/y) after a 0.2% improvement.

Energy prices strengthened 3.5% and by roughly one-third y/y. It was the sixth consecutive month of strong increase. Gasoline prices rose 6.1% (58.1% y/y) for the second consecutive month. Fuel oil & other fuels prices strengthened 1.5% (48.3% y/y) after rising 9.4% in October. Natural gas prices rose 0.6% (25.1% y/y) after a 6.6% gain, while the cost of electricity rose 0.3% last month (6.5% y/y) following a 1.8% October rise.

Food price inflation was strong again at 0.7% (6.1% y/y) last month. Meat, poultry & fish prices rose 1.2% (13.1% y/y) following a 1.9% increase, but egg prices declined 2.7% (+8.0% y/y). Cereal & bakery product costs strengthened 0.8% (4.6% y/y) after rising 1.0% while fruit & vegetable prices surged 1.0% (4.0% y/y) in November after edging 0.1% higher in October. Nonalcoholic beverage prices rose 0.2% (5.3% y/y) after five months of firm gain. Dairy prices rose 0.2% (1.6% y/y) for a second straight month.

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) Nov Oct Sep Nov Y/Y 2020 2019 2018
Total 0.8 0.9 0.4 6.8 1.2 1.8 2.4
Total less Food & Energy 0.5 0.6 0.2 4.9 1.7 2.2 2.1
  Goods less Food & Energy 0.9 1.0 0.2 9.4 0.1 0.2 -0.2
  Services less Energy 0.4 0.4 0.2 3.4 2.2 2.8 2.9
 Food 0.7 0.9 0.9 6.1 3.4 1.9 1.4
 Energy 3.5 4.8 1.3 33.3 -8.5 -2.1 7.5
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