Global| May 12 2020U.S. Consumer Price Index & Core Prices Fall Again
by:Tom Moeller
|in:Economy in Brief
Summary
• Lower energy prices lead the decline. • Food prices jump with increased at-home consumption. • Core goods prices broadly weaken. The CPI fell 0.8% (+0.3%) during April, the largest decline since late-2008. The fall was double the [...]
• Lower energy prices lead the decline.
• Food prices jump with increased at-home consumption.
• Core goods prices broadly weaken.
The CPI fell 0.8% (+0.3%) during April, the largest decline since late-2008. The fall was double the prior month's decline. Expectations had been for a 0.7% decline in the Action Economics Forecast Survey. The CPI excluding food & energy weakened 0.4% (+1.4% y/y) last month after a 0.1% slip. The decline was a record and double the expected increase.
Lower energy prices pulled the CPI down with a 10.1% drop (-17.7% y/y), the largest of four consecutive monthly declines. Gasoline prices dropped 20.6% (-32.0% y/y), double the prior month's decline. Fuel oil prices fell 15.6% (-33.2% y/y) to the lowest price since early-2016. Natural gas prices rose 0.2% (-1.9% y/y) following two months of sharp decline while the cost of electricity edged 0.1% higher (0.2% y/y).
Food prices increased 1.5% in April (3.5% y/y), strengthened by a 2.6% rise (4.1% y/y) in the cost of food for at-home consumption. Prices for food purchased for consumption outside the home edged 0.1% higher (NSA, +2.8% y/y). Egg prices surged 16.1% (17.3% y/y) while meat, poultry & fish prices increased 3.6% (6.2% y/y). Cereal & bakery prices jumped 2.9% (3.1% y/y). Nonalcoholic beverage prices also strengthened 2.9% (5.0% y/y). Fruit & vegetable prices improved 1.5% (0.4% y/y) and dairy prices also increased 1.5% (5.2% y/y).
Goods prices excluding food & energy weakened 0.7% last month (-0.9% y/y) after weakening 0.3%. The decline was led by a 4.7% fall (-5.7% y/y) in apparel prices. Recreation goods prices declined 0.9% (-2.0% y/y) and prices for medical care goods eased 0.1% (+0.7% y/y). New vehicle prices were little-changed (-0.6% y/y) and used car & truck prices fell 0.4% (-0.7% y/y). Moving higher were appliance prices which jumped 1.1% (0.6% y/y) while household furnishings prices improved 0.6% (-0.4% y/y). Prices for education & communication goods rose 0.2% (-3.8% y/y).
Services prices weakened 0.4% in April (+2.2% y/y), a huge decline which was the largest since July 1980. It was paced by a 9.4% drop (-16.0% y/y) in the cost of public transportation. Recreation services prices rose 0.2% (2.4% y/y). Medical care service prices improved 0.5% (5.8% y/y) for a second straight month. Education & tuition prices edged 0.1% higher (2.1% y/y) for a third straight month. Shelter costs held steady (2.6% y/y) for a second month but the owners' equivalent rent of primary residences gained 0.2% (3.1% 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) | Apr | Mar | Feb | Apr Y/Y | 2019 | 2018 | 2017 |
|---|---|---|---|---|---|---|---|
| Total | -0.8 | -0.4 | 0.1 | 0.3 | 1.8 | 2.4 | 2.1 |
| Total less Food & Energy | -0.4 | -0.1 | 0.2 | 1.4 | 2.2 | 2.1 | 1.8 |
| Goods less Food & Energy | -0.7 | -0.3 | 0.2 | -0.9 | 0.2 | -0.2 | -0.7 |
| Services less Energy | -0.4 | -0.0 | 0.2 | 2.2 | 2.8 | 2.9 | 2.7 |
| Food | 1.5 | 0.3 | 0.4 | 3.5 | 1.9 | 1.4 | 0.9 |
| Energy | -10.1 | -5.8 | -2.0 | -17.7 | -2.1 | 7.5 | 7.9 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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