Global| Sep 13 2018U.S. CPI Increase Holds Steady Unexpectedly; Core Price Gain Moderates
by:Tom Moeller
|in:Economy in Brief
Summary
Moderation in consumer price inflation was broad-based during August. Consumer prices rose 0.2% (2.7% y/y) following a 0.2% July gain. A 0.3% increase had been expected in the Action Economics Forecast Survey. The CPI excluding food & [...]
Moderation in consumer price inflation was broad-based during August. Consumer prices rose 0.2% (2.7% y/y) following a 0.2% July gain. A 0.3% increase had been expected in the Action Economics Forecast Survey. The CPI excluding food & energy inched 0.1% higher (2.2% y/y) following three consecutive months of 0.2% gain. A 0.2% rise had been expected.
Stability in last month's CPI increase occurred as goods prices excluding food & energy fell 0.3% (-0.2% y/y) after a 0.1% rise. The decline was paced by a 1.6% drop (-1.4% y/y) in apparel prices, the largest of four consecutive declines. Recreation goods prices fell 0.5% (-2.7% y/y) as video & audio product prices fell 1.1% (-12.8% y/y). That followed stability in July. New vehicle prices held steady (0.3% y/y) after three straight months of firm gain. Medical care product prices slipped 0.3% (+0.3% y/y) following a 1.1% shortfall. The cost of home furnishings eased slightly (-0.5% y/y) following a 0.5% rise. Appliance prices gained 0.3% (2.3% y/y) after a 1.5% jump.
Nonenergy services price inflation moderated to 0.2% (3.0% y/y) after a 0.3% July gain. Transportation services increased 0.3% (3.9% y/y) after a 0.5% increase. Medical care prices slipped 0.2% (+1.9% y/y) after a 0.1% rise. Education & communications services prices rose 0.2% (1.6% y/y), the weakest increase in four months. Recreation services prices improved 0.1% (1.4% y/y), the same as in July. Both gains were down from 0.4% in the prior two months. Shelter prices rose a steady 0.3% (3.4% y/y) as the owners' equivalent rent of primary residences rose 0.3% (3.3% y/y), as it has for roughly a year. Rents also increased a steady 0.3% (3.4% y/y).
Countering these measures of moderation was a 1.9% increase (10.2% y/y) in energy prices which followed a 0.5% decline. Gasoline prices jumped 3.0% (20.3% y/y) following a 0.6% dip. The cost of fuel oil rose 2.2% (30.9% y/y) after a 1.2% rise. Natural gas prices rose 0.9% (0.1% y/y) following a 0.5% decline. The cost of electricity rose 0.3% (-0.5% y/y) and reversed July's fall.
Food prices improved 0.1% in August (1.4% y/y), the same as during the prior month. Meat, poultry & fish prices rose 0.2% (0.3% y/y) after a 0.3% rise. Cereal & bakery product prices held steady (0.3% y/y) following a 0.2% dip. Egg prices declined 1.2% (+14.7% y/y) after a 0.2% easing and dairy product prices improved 0.1% (-0.0% y/y) following a 0.6% decline. Fruit & vegetable prices declined 0.3% (+0.9% y/y) after a 1.0% strengthening. Nonalcoholic beverage prices rose 0.2% both m/m and y/y.
The consumer price data can be found in Haver's USECON database with additional detail in CPIDATA. The Action Economics survey figure is in the AS1REPNA database.
The Fed's latest Beige Book covering regional economic conditions can be found here.
| Consumer Price Index, All Urban Consumers (% chg) | Aug | Jul | Jun | Aug Y/Y | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|
| Total | 0.2 | 0.2 | 0.1 | 2.7 | 2.1 | 1.3 | 0.1 |
| Total less Food & Energy | 0.1 | 0.2 | 0.2 | 2.2 | 1.8 | 2.2 | 1.8 |
| Goods less Food & Energy | -0.3 | 0.1 | -0.0 | -0.2 | -0.7 | -0.5 | -0.5 |
| Services less Energy | 0.2 | 0.3 | 0.2 | 3.0 | 2.7 | 3.1 | 2.6 |
| Food | 0.1 | 0.1 | 0.2 | 1.4 | 0.9 | 0.3 | 1.9 |
| Energy | 1.9 | -0.5 | -0.3 | 10.2 | 7.9 | -6.6 | -16.7 |
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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