Global| Jun 16 2016U.S. CPI Moderates Despite Higher Energy Prices
by:Tom Moeller
|in:Economy in Brief
Summary
The recent increase in energy prices has been offset by a tame pricing environment elsewhere. Last month, that left the increase in the Consumer Price Index moderating to 0.2% (1.0% y/y) following an unrevised 0.4% April rise. The [...]
The recent increase in energy prices has been offset by a tame pricing environment elsewhere. Last month, that left the increase in the Consumer Price Index moderating to 0.2% (1.0% y/y) following an unrevised 0.4% April rise. The gain fell short of expectations in the Action Economics Forecast Survey for a 0.3% rise. Energy price inflation moderated with a 1.2% increase (-10.1% y/y) following a 3.4% rise. Food price inflation also eased as prices fell 0.2% (+0.7% y/y). The CPI excluding both food & energy matched expectations and increased a steady 0.2% (2.2% y/y).
The increase in energy prices moderated as gasoline prices rose 2.3% (-16.9% y/y) following April's 8.1% gain. Since the February low, gasoline prices have risen 12.9%. Continuing to firm, however, were fuel oil costs which rose a strengthened 6.2% (NSA, -23.6% y/y). Also stronger were natural gas prices, up 1.7% (-4.7% y/y), the strongest monthly gain since December 2014. Electricity prices fell 0.2% (-1.3% y/y), down for five of the last six months.
Food prices fell 0.2% (+0.7% y/y), down for two of the last three months. Price declines spread throughout most categories. Fruit & vegetable prices were off 0.7% (+1.0% y/y) while dairy & related product costs eased 0.6% (-2.2% y/y). Meat, poultry & fish prices declined 0.5% (-3.2% y/y) and cereal & bakery product costs eased 0.4% (-0.2% y/y).
Also to the downside were goods prices excluding food & energy which posted a 0.2% decline (-0.5% y/y), off for the third straight month. The decline was led by used car & truck prices which fell 1.3% (-2.3% y/y). New vehicle costs also eased 0.1% (-0.2% y/y). Recreation product prices declined 0.3% (-2.6% y/y). Medical care product prices slipped 0.2% (+2.2% y/y). These declines were offset by a 0.8% rebound (0.5% y/y) in apparel prices. Appliance prices also rose 0.6% (-3.0% y/y).
Services prices less energy rose 0.3% (3.2% y/y) for the fourth month this year. Medical care services costs led the increase with a 0.5% rise (3.5% y/y). Shelter costs followed with a 0.4% rise (3.4% y/y) as the owners' equivalent rent of primary residences gained 0.3% (3.3% y/y). Transportation services prices overall rose 0.3% (3.2% y/y), but public transportation costs declined 0.8% (-1.0% y/y). Recreation services prices rose 0.2% (3.1% y/y), the weakest rise in six months. Tuition and other school fees rose 0.3% (3.0% y/y).
The consumer price data is available in Haver's USECON database while detailed figures can be found in CPIDATA. The expectations figure is from Action Economics and is found in the AS1REPNA database.
| Consumer Price Index, All Urban Consumers (%) | May | Apr | Mar | May Y/Y | 2015 | 2014 | 2013 |
|---|---|---|---|---|---|---|---|
| Total | 0.2 | 0.4 | 0.1 | 1.0 | 0.1 | 1.6 | 1.5 |
| Total less Food & Energy | 0.2 | 0.2 | 0.1 | 2.2 | 1.8 | 1.7 | 1.8 |
| Goods less Food & Energy | -0.2 | -0.1 | -0.2 | -0.5 | -0.5 | -0.3 | -0.0 |
| Services less Energy | 0.3 | 0.3 | 0.2 | 3.2 | 2.6 | 2.5 | 2.4 |
| Food | -0.2 | 0.2 | -0.2 | 0.7 | 1.9 | 2.4 | 1.4 |
| Energy | 1.2 | 3.4 | 0.9 | -10.1 | -16.7 | -0.3 | -0.7 |
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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