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Economy in Brief
UK Consumer Sentiment Hits Lowest Reading since 1996
(when the GFK survey began; also lowest reading 'ever')
Of these 13 readings eight of them declined on the month in May three of them improved and two of them were unchanged...
U.S. Existing Home Sales Continue to Fall in April as Houses Become Less Affordable
The combination of soaring home prices across the nation and rising interest rates is making homes less affordable...
U.S. Index of Leading Indicators Fell in April
Five of the index's components fell in April, one was unchanged and four increased...
U.S. Unemployment Claims Rose in the Latest Week
The state insured rates of unemployment in regular programs vary widely...
CBI Gauge in the UK Continues to Be Upbeat
The global economy has a lot of challenges...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
Profits and Margins Plunge In Q1: Expect More Margin Contraction As Fed Squeezes Inflation
The Many Links of Inflation Cycle: Hard Landing Is Needed to Crack Them
Peak Inflation and Fed Policy: A Relationship which Should Worry the Fed and Scare Investors
Why Have the Yields on TIPS Been Negative in the Past Two Years?
by Tom Moeller February 20, 2004
The Consumer Price Index (CPI-U) rose 0.5% in January versus the Consensus expectation for a 0.3% gain. Less food & energy prices rose 0.2%, slightly firmer than the 0.1% Consensus expectation.
Rising energy prices were the source of the upside surprise last month as they jumped 4.7%. Gasoline prices spiked 8.1% (+8.3% y/y) following three months of flat to lower prices. Fuel oil prices also were strong, up 6.8% (9.7% y/y).
Prices of core consumer goods were unchanged following more than a year of deflation. Much of that "firming" came as prices for household furnishings & operation rose 0.4% (-1.6% y/y), only the second monthly increase since February. Apparel prices fell another 0.3% (-1.8% y/y) and new & used motor vehicle prices edged 0.1% lower (-4.0% y/y).
Core services prices were again tame, rising just 0.2%. Shelter prices ticked up only 0.1% (2.0% y/y) and medical care services price inflation eased to 0.3% (4.3% y/y). Public transportation prices rose for the first month in three by 0.2% (2.0% y/y).
The chained CPI which adjusts for shifts in consumer buying behavior rose (0.5%) for the first month since September. It is similar to the PCE price deflator. The core price measure also rose (0.2%) for just the first month in three.
A working paper from the Federal Reserve Bank of Kansas City titled "Disaggregate evidence on the persistence of consumer price inflation" can be viewed here.
| Consumer Price Index | Jan | Dec | Y/Y | 2003 | 2002 | 2001 |
|---|---|---|---|---|---|---|
| Total | 0.5% | 0.2% | 2.0% | 2.3% | 1.6% | 2.8% |
| Total less Food & Energy | 0.2% | 0.1% | 1.1% | 1.5% | 2.3% | 2.7% |
| Goods less Food & Energy | 0.0% | -0.1% | -2.2% | -2.0% | -1.1% | 0.3% |
| Services less Energy | 0.2% | 0.2% | 2.5% | 2.9% | 3.8% | 3.7% |
| Energy | 4.7% | 0.3% | 7.7% | 12.2% | -5.8% | 3.7% |
| Food & Beverages | 0.0% | 0.5% | 3.6% | 2.1% | 1.8% | 3.1% |
| Chained CPI: Total (NSA) | 0.5% | -0.2% | 1.6% | 1.9% | 1.3% | 2.3% |
| Total less Food & Energy | 0.2% | -0.3% | 0.8% | 1.1% | 1.9% | 2.0% |
