Global| Dec 10 2020U.S. Consumer Price Index & Core Prices Resume Increase
by:Tom Moeller
|in:Economy in Brief
Summary
• Retail price inflation remains under control. • Goods prices continue to firm y/y. • Service price inflation is decelerating. The Consumer Price Index rose 0.2% (1.2% y/y) during November following no change in October. A 0.1% [...]
• Retail price inflation remains under control.
• Goods prices continue to firm y/y.
• Service price inflation is decelerating.
The Consumer Price Index rose 0.2% (1.2% y/y) during November following no change in October. A 0.1% improvement had been expected in the Action Economics Forecast Survey. The CPI excluding food & energy also rose 0.2% (1.6% y/y) last month, also after stability in October. A 0.1% gain had been expected.
Goods prices excluding food & energy edged 0.1% higher (1.4% y/y) after a 0.2% October decline and increases between 0.7% and 1.0% during the prior three months. The 1.4% y/y increase compares to y/y price declines from January through July. Home appliance prices jumped 2.2% last month and the 6.1% y/y gain was improved from -2.1% y/y in January. The cost of household furnishings strengthened 0.9% (2.9% y/y) following two straight months of decline. Apparel prices also firmed 0.9% but fell 5.2% y/y. Prices for education & communication goods increased 0.4% (-4.3% y/y) following two months of negative readings. Recreation goods prices rose 0.3% (-1.0% y/y) following two straight months of decline. To the downside, used car & truck prices fell 1.3% (+10.9% y/y) and new vehicle costs dipped 0.1% (+1.6% y/y). Medical care product costs fell 0.3% (-1.1% y/y) after weakening during the prior four months. That compared to a 2.5% increase during all of last year.
Services prices rose 0.2% (1.7% y/y) last month after improving 0.1% in October. Education & communication prices held steady but strengthened 2.4% y/y. Tuition costs rose 0.2% (1.3% y/y). Medical care service prices eased 0.1% and the 3.2% y/y rise compared to 6.0% y/y as of June. Shelter costs rose 0.1% and by a greatly lessened 1.9% y/y. The owners' equivalent rent of primary residences held steady and gained 2.3% y/y. To the upside, recreation services prices strengthened 0.5% (2.6% y/y) following a 0.7% strengthening. The cost of public transportation jumped 2.5%, strong for the third straight month, but fell 12.0% y/y.
Energy product prices moved 0.4% higher (-9.4% y/y) following a 0.1% improvement. The cost of natural gas surged 3.1% (4.4% y/y), strong for the second month in the last three. Fuel oil prices strengthened 3.6% (-26.4% y/y). Electricity prices rose 0.5% (1.6% y/y) following two months of strong increase while gasoline prices slipped 0.4% (-19.3% y/y) after falling 0.5%.
Food prices eased 0.1% and by a strengthened 3.7% y/y. Food-at-home prices eased 0.3% (+3.6% y/y). The decline reflected a 0.5% drop (+2.4% y/y) in cereal & bakery product prices. A 1.0% rise (4.3% y/y) in egg prices countered the weakness. Meat, poultry & fish prices edged 0.1% higher (6.0% y/y). Fruit & vegetable prices held steady (3.0% y/y). Dairy & dairy product prices rose 0.3% (3.6 y/y), up from a 2.4% rise last year. Nonalcoholic beverage prices declined 0.9% (+3.0% y/y). Prices of food away from home rose 0.1% (NSA) and by a strengthened 3.8% 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) | Nov | Oct | Sep | Nov Y/Y | 2019 | 2018 | 2017 |
|---|---|---|---|---|---|---|---|
| Total | 0.2 | 0.0 | 0.2 | 1.2 | 1.8 | 2.4 | 2.1 |
| Total less Food & Energy | 0.2 | 0.0 | 0.2 | 1.6 | 2.2 | 2.1 | 1.8 |
| Goods less Food & Energy | 0.1 | -0.2 | 0.8 | 1.4 | 0.2 | -0.2 | -0.7 |
| Services less Energy | 0.2 | 0.1 | 0.0 | 1.7 | 2.8 | 2.9 | 2.7 |
| Food | -0.1 | 0.2 | 0.0 | 3.7 | 1.9 | 1.4 | 0.9 |
| Energy | 0.4 | 0.1 | 0.8 | -9.4 | -2.1 | 7.5 | 7.9 |
U.S. Government Budget Deficit Deepens in October
by Tom Moeller December 10, 2020
• Revenues decline and outlays surge.
The U.S. Treasury Department reported that the federal budget deficit increased to $284.1 billion during October compared to $134.5 billion twelve months earlier. The Action Economics Survey anticipated a $279.0 billion deficit for last month.
Federal government outlays jumped 37.3% y/y to $521.8 billion last month compared to a 47.3% rise during all of FY 2020. The increase was driven by a 134.9% surge in income security payments to $72.7 billion, stemming from coronavirus relief payments and a higher unemployment rate. Medicare spending surged 72.1% y/y to $96.3 billion while health care spending increased 22.9% y/y to $63.1 billion. Social security payments grew a lessened 4.4% y/y to $92.9 billion but growth in defense outlays picked up to 11.6% y/y, $79.7 billion. Interest payments eased slightly to $32.4 billion.
Overall revenues declined 3.2% y/y to $237.7 billion during October. The recession lowered individual income tax payments by 14.0% y/y to $108.7 billion, but corporate tax receipts rose 39.3% y/y to $9.2 billion. Growth in social insurance tax payments picked up slightly to 6.7% y/y to $95.9 billion, and the reduction in global economic trade lowered customs duties by 20.6% y/y to $6.2 billion.
Haver's data on Federal Government outlays are contained in USECON; detailed data can be found in the GOVFIN database. The Action Economics Forecast Survey numbers are in the AS1REPNA database.
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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