Global| Mar 17 2011U.S. CPI Firms Again
by:Tom Moeller
|in:Economy in Brief
Summary
Broad-based improvement in pricing power continued last month. The Consumer Price Index rose 0.5% in February following 0.4% gains during the prior two months. The rise beat Consensus expectations for a 0.4% increase. The y/y gain of [...]
Broad-based improvement in pricing power continued last month.
The Consumer Price Index rose 0.5% in February following 0.4% gains during
the prior two months. The rise beat Consensus expectations for a 0.4%
increase. The y/y gain of 2.2% was the strongest since March of last year
and the three-month increase of 5.6% (AR) was the firmest since mid-2008.
Core price inflation also has improved, but more modestly. The CPI less
food & energy rose 0.2% versus Consensus expectations for a 0.1%
uptick. The y/y gain of 1.1% was the firmest since last March and the 1.8%
three-month was the strongest since late-2009.
Energy prices led last month's gain with a 3.4% increase. Gasoline prices gained 4.7% (19.2% y/y) while home heating oil prices rose 4.1% (NSA, 17.9% y/y). Prices for natural gas & electricity increased 1.1% and by 0.2% y/y. Food & beverage prices rose another 0.5%. The gain was backed by a 2.2% jump in fruit & vegetable prices (4.3% y/y) and a 1.2% increase in meat, poultry, fish & eggs (6.9% y/y).
Core consumer pricing power posted a second 0.2% increase. For goods alone prices rose 0.2%, also for the second month, led by a 0.5% increase (0.5% y/y) in motor vehicles. Prices for household furnishings & operation ticked up 0.1% (-1.9% y/y) but apparel prices fell 0.9% (-0.4% y/y).
Pricing power for core services also improved slightly to 0.2% (1.5% y/y). To the upside, public transportation costs again led the gain with a 1.9% increase (9.7% y/y). Education costs were strong and posted a 0.4% increase (4.1% y/y) while medical care service prices also rose 0.4% (3.0% y/y). Shelter costs, which are 32% of the CPI, rose 0.1% for the fifth straight month; however, the y/y change improved to 0.8% due to declines early last year. Owners equivalent rent of primary residences, a measure not equivalent to other house price measures, ticked up 0.1% while the y/y increase improved to 0.6% after no change last year. Nevertheless, the reading remained nearly the weakest since the series' start in 1983.
The chained CPI, which adjusts for shifts in consumption patterns, rose 0.5% and 2.0% year-to-year. Chained prices less food & energy jumped 0.4% m/m and rose 0.9% y/y.
The consumer price data is available in Haver's USECON database while detailed figures can be found in the CPIDATA database.
| Consumer Price Index (%) | Feb | Jan | Dec | Feb Y/Y | 2010 | 2009 | 2008 |
|---|---|---|---|---|---|---|---|
| Total | 0.5 | 0.4 | 0.4 | 2.2 | 1.6 | -0.3 | 3.8 |
| Total less Food & Energy | 0.2 | 0.2 | 0.1 | 1.1 | 1.0 | 1.7 | 2.3 |
| Goods less Food & Energy | 0.2 | 0.2 | -0.1 | -0.0 | 1.1 | 1.3 | 0.1 |
| Services less Energy | 0.2 | 0.1 | 0.1 | 1.5 | 0.9 | 1.9 | 3.1 |
| Energy | 3.4 | 2.1 | 4.0 | 11.2 | 9.6 | -18.2 | 13.7 |
| Food & Beverages | 0.5 | 0.5 | 0.1 | 2.2 | 0.8 | 1.9 | 5.4 |
| Chained CPI: Total (NSA) | 0.5 | 0.5 | 0.2 | 2.0 | 1.5 | -0.1 | 3.7 |
| Total less Food & Energy | 0.4 | 0.1 | -0.2 | 0.9 | 0.7 | 1.5 | 2.0 |
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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