CPI Latest DATA results, June 13, 2023

The BLS report was released this morning and it was a shade below consensus estimates. (historical releases)

The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.1 percent in May on a seasonally adjusted basis, after increasing 0.4 percent in April, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 4.0 percent before seasonal adjustment.

The index for shelter was the largest contributor to the monthly all items increase, followed by an increase in the index for used cars and trucks. The food index increased 0.2 percent in May after being unchanged in the previous 2 months. The index for food at home rose 0.1 percent over the month while the index for food away from home rose 0.5 percent. The energy index, in contrast, declined 3.6 percent in May as the major energy component indexes fell.

I read some reports how inflation came in well below expectations. Apparently those expectations got inflated prior to this release. The expected inflation Y/Y was 4.13% and this report came in at 4.048%.

It goes without saying that energy costs going down is a major factor in these lower inflation rates.

Yes, today's release is the lowest since March, 2021. However, the period since that date has seen overall prices increase 14.82% in that 26 month period. Which matches the rise of prices from August, 2012 until March, 2021. A period of 103 months.

Here is some food for thought. Food at home, has risen 19.5% in the 26 months, since March, 2021. It rose 19.5% from May, 2008, until March, 2021... a period of 102 months.

Those stats are a bit hard to chew.

So yes, inflation is slowing and should continue to slow. But once again, without the energy component, and the food component... prices increased 5.3%. Food was generally flat for the month, but still up 5.8% Y/Y.

My own personal CPI...

The current report card...

It is down across the board and hopefully... will continue to slide. 

CPI Latest DATA results, May 10, 2023

The BLS report was released this morning and it was a shade below consensus estimates. (historical releases)

The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.4 percent in April on a seasonally adjusted basis, after increasing 0.1 percent in March, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 4.9 percent before seasonal adjustment.

The index for shelter was the largest contributor to the monthly all items increase, followed by increases in the index for used cars and trucks and the index for gasoline. The increase in the gasoline index more than offset declines in other energy component indexes, and the energy index rose 0.6 percent in April. The food index was unchanged in April, as it was in March. The index for food at home fell 0.2 percent over the month while the index for food away from home rose 0.4 percent.

For the record, some rounding makes this appear much better. Last month's 5.0% was 4.98%, and this month's 4.9% is 4.93%.

The all items less food and energy index rose 5.5 percent over the last 12 months. (5.52%)

That compared to 5.6%, last month. (5.59%)

My own personal CPI...

Note that both CPI-W and Chained CPI edged up.

So once again, I should be happy with my index showing only 3.8%, but that is misleading. Remember, that COLA adjustment that came into effect in January, 2023? That made us whole back to 3rd quarter, 2021.

Any COLA for January, 2024, will most likely be in the >3.4% range. That 3.8% is operating at a loss.

As always, I keep track of my expenses, weighting, etc. Yours may be different.  

CPI Latest DATA results, Reports for March 2023

The BLS report was released this morning and it was a shade below consensus estimates. (historical releases)

The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.1 percent in March on a seasonally adjusted basis, after increasing 0.4 percent in February, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 5.0 percent before seasonal adjustment.

The index for shelter was by far the largest contributor to the monthly all items increase. This more than offset a decline in the energy index, which decreased 3.5 percent over the month as all major energy component indexes declined. The food index was unchanged in March with the food at home index falling 0.3 percent.

The index for all items less food and energy rose 0.4 percent in March, after rising 0.5 percent in February. Indexes which increased in March include shelter, motor vehicle insurance, airline fares, household furnishings and operations, and new vehicles. The index for medical care and the index for used cars and trucks were among those that decreased over the month.

A couple of notes... "all major components declined". That is with "seasonal" adjustment. While the overall index eased, the gasoline component was up +1.0% and is currently on the rise for April, as in +3.0%. Be careful of the spin.

Food at home, did drop, but that food away from home... seems to be hanging tough.

The real story is sticky prices, or Core, or CPI ex- food and energy. It actually rose on an annual basis, and was above expectations on the monthly. It would have been even worse, but the Medical side inexplicably fell. If it had remained flat, you could add another +0.1% to that Core.

Simply looking at the core at 5.6%, with the overall being 5.0%... should tell you that drops in energy is where the most savings are. Further browsing through the numbers, indicate most items, other than gasoline are where those savings are. How much longer can that last?

The forecast indicates an increase in Core, with the overall remaining at current level of +5.0%. So clearly the big brains think it will continue. The may be right, but the politics of pump prices, tends to overshadow all the other energy components. 

Generally speaking, those winter heating bills drop and consumers don't really recognize the cost per unit difference. Gasoline is right in your face at the pump... and everyone seems to recognize that cost per unit.

My own personal CPI...

I guess I should be happy with the +0.1% M/M, and +4.0% Y/Y, but I don't like inflation of any type. 

CPI DATA results, March Reports 2023

The BLS report was released this morning and it was a shade above consensus estimates. (historical releases)

The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.4 percent in February on a seasonally adjusted basis, after increasing 0.5 percent in January, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 6.0 percent before seasonal adjustment.

The index for shelter was the largest contributor to the monthly all items increase, accounting for over 70 percent of the increase, with the indexes for food, recreation, and household furnishings and operations also contributing. The food index increased 0.4 percent over the month with the food at home index rising 0.3 percent. The energy index decreased 0.6 percent over the month as the natural gas and fuel oil indexes both declined.

The index for all items less food and energy rose 0.5 percent in February, after rising 0.4 percent in January. Categories which increased in February include shelter, recreation, household furnishings and operations, and airline fares. The index for used cars and trucks and the index for medical care were among those that decreased over the month.

The all items index increased 6.0 percent for the 12 months ending February; this was the smallest 12-month increase since the period ending September 2021. The all items less food and energy index rose 5.5 percent over the last 12 months, its smallest 12-month increase since December 2021. The energy index increased 5.2 percent for the 12 months ending February, and the food index increased 9.5 percent over the last year. 

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That's all from the BLS. Now on to my inflation stats. Which receded annually to 5.0% and 0.2% month to month.

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I would hope for a repeat during March, but with nearly half the month already gone... it is looking a bit iffy. 

Overall, the inflation outlook is improving, but still some pinkish areas overall. The PPI report tomorrow might provide a better outlook.

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Most everything I have read, indicates the CPI report was "close" to expectations. The upside surprise was the Core figures, which were tad above expectations. 

Which brings me to the March expectations. Everything I am reading indicates next month's release will have a much lower rate of inflation, as in 5.2% range. However, core is expected in the range of 5.7%, or to increase. Also on the month to month.

For that to happen the non core part - food and energy,  would have to drop fairly sharply. Not really seeing it at this point.

CPI DATA results, February Reports 2023

The BLS report was released this morning and it was a shade above consensus estimates. (historical releases)

The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.5 percent in January on a seasonally adjusted basis, after increasing 0.1 percent in December, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 6.4 percent before seasonal adjustment.

The index for shelter was by far the largest contributor to the monthly all items increase, accounting for nearly half of the monthly all items increase, with the indexes for food, gasoline, and natural gas also contributing. The food index increased 0.5 percent over the month with the food at home index rising 0.4 percent. The energy index increased 2.0 percent over the month as all major energy component indexes rose over the month.

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It would seem the food at home index is getting a lot of attention. The concept that things are really getting better in this area. 

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Aside from the dip in November, the prices have been increasing. Of course, that didn't prevent one wag from looking at the wrong line on the report and coming up with something called a 3 month average, annualized, as proof that things are trending downward. 

Except, the downward trend, sharply ended a couple of months ago, and is now on the rise. Using the correct line from the report, yields this...

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So yes, this method does indicate a number below the y/y, but is now indicating 2 consecutive months of upward movement. The M/M unadjusted was +0.8%, or annualized to 9.6%. Not far from the y/y rate of 10.1%.

I get the distinct impression the CPI coming up above expectations, is being rationalized with but, but, but arguments.

Not sure how these arguments can hold up, but we Americans are easily manipulated. Actually, people around the globe are much the same.

CPI DATA and Real Earnings, January Reports 2023

The BLS report was released this morning and it was within target range. (historical releases)

The Consumer Price Index for All Urban Consumers (CPI-U) declined 0.1 percent in December on a seasonally adjusted basis, after increasing 0.1 percent in November, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 6.5 percent before seasonal adjustment.

The index for gasoline was by far the largest contributor to the monthly all items decrease, more than offsetting increases in shelter indexes. The food index increased 0.3 percent over the month with the food at home index rising 0.2 percent. The energy index decreased 4.5 percent over the month as the gasoline index declined; other major energy component indexes increased over the month.

Much is made of the CPI decline over the past six months, but there is a recurring theme...

The index for gasoline was by far the largest contributor to the monthly all items decrease, more than offsetting... [insert item]

My CPI continues to improve...

Hourly earnings have just about caught up with pre covid earnings. Real Earnings

It is now a mere 1¢ below February 2020 level per hour. Weekly earnings are still -$1.30 to February 2020. Almost there.

Pump prices have leveled off. Other energy prices will level off very soon. Both will start to rise going forward into the summer months.

Core inflation has been mainly in check for the past three months due to adjustments in the medical area, as well as a continuing slide in used car prices. The Medical adjustments were a 4th quarter one and-done. The used car slide may continue.

Maybe I am a cup-half-empty guy, but I don't see inflation returning to acceptable levels before the fall. 

However, a recession might bring it down faster.  

CPI DATA and Real Earnings, December Reports 2022

The BLS report was released this morning and it was a surprise. (historical releases) It came in substantially under the forecast by everyone.

Last month, I projected this...

Range of 7.6%~7.9%. Sure things are moderating, but can we count on further reductions in Electricity, Utility (piped) gas service, apparel, Used cars and trucks, and Medical Care services? 

The answer to the question is yes. 

The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.1 percent in November on a seasonally adjusted basis, after increasing 0.4 percent in October, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 7.1 percent before seasonal adjustment.

The index for shelter was by far the largest contributor to the monthly all items increase, more than offsetting decreases in energy indexes. The food index increased 0.5 percent over the month with the food at home index also rising 0.5 percent. The energy index decreased 1.6 percent over the month as the gasoline index, the natural gas index, and the electricity index all declined.

The past 5 months (June to November) has been at an annualized rate of +1.13%. For comparison, the previous 5 months of January through June was an annualized rate of +12.94%. A major improvement in inflation, although it could be due to lower demand. Have to wait and see. 

For the first time in quite a long time, my monthly change was negative. Using the aforementioned 5 month ranges, the last 5 months was at annualized +1.41%, compared to prior 5 month annualized, of +10.94%. For year over year, My CPI stands at +6.7%

Hourly earnings have just about caught up with pre covid earnings. Real Earnings

I have done such a bang up job on predictions, I will not make any bold predictions for the future, although significant easing of energy prices is underway... although I suspect that might come to an end very soon. 

 

CPI DATA and Real Earnings, November 2022

The BLS report was released this morning and it was a surprise. (historical releases) It came in substantially under the forecast by everyone.

My forecast from last month...

Oh yeah... next month CPI at 8.1%~8.2%, with m/m of +0.8%.

As you know by now...

The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.4 percent in October on a seasonally adjusted basis, the same increase as in September, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 7.7 percent before seasonal adjustment.

Of course, just as their is a silver lining inside every dark cloud, there can be a dark lining inside a silver cloud. Such as the month over month of July, at -0.01%; August at -0.04%; September at +0.22%; and this report (October) at +0.41%. Still not bad. 

My month over month was +0.08% and annual at 7.41% after last month's +0.33% mom and annual at 8.08%. For me, food somewhat decreased and medical stayed mostly flat. 

Hourly earnings have still not recover to pre-pandemic levels. Which is a nice way of saying wage inflation has not kept up with the CPI. Real Earnings

I over estimated inflation for October, so here is hoping I over shoot in November. Range of 7.6%~7.9%. Sure things are moderating, but can we count on further reductions in Electricity, Utility (piped) gas service, apparel, Used cars and trucks, and Medical Care services? 

Am I an optimist, pessimist, or realist?

Will the Consumer Continue to Carry the U.S. Economy?

Hmmm... The real earnings are almost healed compared to February 2020...

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with unemployment rate, now matching that date as well...

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As well as the number of employed near the same number or slightly higher...

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So, everything should be hunky-dory... right? Even when counting in the various stimuli and inflation adjusted retail trade...

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Everything almost matches up, when considering the consumer credit...

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Except the real earnings are inflation adjusted, the retail trade has been inflation adjusted, but the consumer credit is nominal. Which is ever so slightly slipping behind, when factoring inflation. At least that is my take.

Of course, the graph does not capture all credit numbers.  From the Federal Reserve. 

In August, consumer credit increased at a seasonally adjusted annual rate of 8.3 percent. Revolving credit increased at an annual rate of 18.1 percent, while nonrevolving credit increased at an annual rate of 5.1 percent.

The inflation rate from the CPI was 8.3 percent annually for this period. Revolving credit has jumped 2.5% since June and nonrevolving was 0.9% during that period. We all know that interest rates are moving up, but which would have the higher interest rates? Revolving or nonrevolving?

In normal times, the revolving credit would increase roughly 3.6% annually and nonrevolving credit would edge up about 5% annually. So the 2 month jump in nonrevolving of 0.9%, does stay within the norms. That 2.5%, 2 month revolving credit jump does not translate very well to annual... 15%. It's basically four times higher, against a backdrop of increasing interest rates. 

Those believing the consumer can keep the economy going... are living on borrowed time. It will not be long, before the evidence of a consumer spending decline is clear. 

My guess would be the month following the first cold shock and those higher heating bills arrive. 

Breakdown of the CPI DATA and Real Earnings reports for September 2022

It is that time of month, to survey the damage from inflation. The BLS report was released this morning and it was a surprise. (historical releases)

This is what I projected for the month...

For next month's projection, another wide range... 7-8%~8.3%, with month to month of -0.1~ up to 0.3%. The drop in gasoline failed to cover all the other areas, and the drop in gasoline for September will be much smaller, in my opinion.

Hmm... 

The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.4 percent in September on a seasonally adjusted basis after rising 0.1 percent in August, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 8.2 percent before seasonal adjustment.

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My own personal CPI was 8.1% year over year and up 0.3% from last month.

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The C.O.L.A. for 2023 is set at 8.7%...

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Last month I had stated the likelihood of 8.7%, but then got antsy an edged up the forecast to 8.8%. I really did not anticipate the CPI-W would underperform, compared to the CPI-U. That string since the start of covid has apparently ended. In any case, it almost was 8.8%, as pushing out a couple of digits was 8.746%. That 291.854 was just off the 291.879 to edge it to 8.750% and rounding to 8.8%. 

That was me trying to justify my errors. Close only counts in horseshoes and hand grenades. 

As for the Real Earnings ...

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It still has not gotten back to pre-covid purchasing power and slipped last month. Of course that is for hourly workers, while the earnings for production and non supervisory employees was actually up $.03 hourly, from pre-covid and $3.68 weekly. So, the working stiffs are healing faster.

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Real earnings are already adjusted for inflation.

And an apples to apples comparison can also be made as unemployment now matches February 2020.

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We should remember Covid hit the lower wage earners the hardest, as they were originally deemed non-essential and sent home, thus distorting the hourly and weekly rate. The higher wage earners were able to "work from home" while masturbating on zoom calls, etc. Until they realized that some of those non essentials were actually a bit more essential than first thought.

In any case, a fair apples to apples is now compared to February 2020. At least that is my opinion.

Seemed like I was going to mention petroleum. Crude Oil inventory up nearly 10M barrels, with Gasoline up 2M barrels, and uh oh... distillates down 4.8M barrels. Natural Gas inventories are starting to gain ground as well.

Tomorrow is the retail report, which should be interesting.

Oh yeah... next month CPI at 8.1%~8.2%, with m/m of +0.8%.

Breakdown of CPI DATA and Real Earnings, August 2022

It is that time of month, to survey the damage from inflation. The BLS report was released this morning and it was a surprise. (historical releases)

This is what I projected for the month...

Now for next month's CPI-U, and here's hoping I am once again overshooting... month over month at 0.0%~0.2% and year to year of 8.3% to 8.5%. 

Well, it was... 

The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.1 percent in August on a seasonally adjusted basis after being unchanged in July, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 8.3 percent before seasonal adjustment. 

Gasoline fell much, much further than last month and failed to provide cover for all the other areas, which are inflating. 

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Unadjusted remains sort of flat. Meanwhile my personal inflation rate edged up to 7.9%, with a +0.26% month to month increase. 

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On to the C.O.L.A. ... The CPI-W slid -0.2% for the month, which essentially narrowed the range for C.O.L.A. adjustments.

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Frankly speaking and after checking my pencil for an eraser... I'll pencil in 8.7% as the most likely C.O.L.A. The September CPI-W has a very wide range, as can be seen. Either side of the 8.7% figure is also a rather wide range.

As for the Real Earnings...

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The hourly is edging up slightly, but still below February 2020 rate.

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The weekly level slipped this month (all inflation adjusted) and is still below the February 2020 level.

For next month's projection, another wide range... 7-8%~8.3%, with month to month of -0.1~ up to 0.3%. The drop in gasoline failed to cover all the other areas, and the drop in gasoline for September will be much smaller, in my opinion. 

I guess what I am saying is... there could easily be another upside surprise, when the September numbers come out. I sincerely hope not. It has nothing to do with stocks, Federal Reserve or Macro Economics. I am just a poor schmuck getting squeezed.

Breakdown of CPI DATA and Real Earnings, July 2022

It is that time of month, to survey the damage from inflation. The BLS report was released this morning and it was a surprise. (historical releases)

This is what I projected for the month...

So, I will project 0.3%~0.5% month to month and a reading of 8.9%~9.1%. I fervently hope I am over shooting, this time. 

I did overshoot, as well as many others. 

The Consumer Price Index for All Urban Consumers (CPI-U) was unchanged in July on a seasonally adjusted basis after rising 1.3 percent in June, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 8.5 percent before seasonal adjustment.

My own personal CPI was up a bit, after all the checks, credit cards, etc. were accounted for...

My annual rate is 7.8%, which is better than the CPI-U and CPI-W. Which brings me to the C.O.L.A. 

As July is 1/3 of C.O.L.A., it is very important. The forecast took quite a hit, from last month...

It would probably be best to state the 8.6%~9.0% is the high range, with expectations of a slide from there. 

However, while the CPI-U inflation number of 8.5% seems like an improvement, the food section is worrying. The report avoided the "food at home" on annual basis of 13.1%, although it did mention the 1.3% month to month rise, which is the 7th consecutive month of 1.0% or higher. Chew on that!!

While it is noted that gasoline fell, electricity has now risen 15.2% y/y and 3rd consecutive m/m increases of over 1%, with July at 1.6%.

The Real Earnings report also came out this morning...

Hooray, an uptick away from the downward trend, and getting closer to real earnings of pre-Covid.

Weekly earnings mirrored the hourly earnings. Both are due to a flat month to month CPI report, which is better than the opposite. Is it the start of a trend?

Not a bad set of number, considering the expectation. 

Now for next month's CPI-U, and here's hoping I am once again overshooting... month over month at 0.0%~0.2% and year to year of 8.3% to 8.5%. 

While gasoline is expected to have similar drops, relative to July's numbers... they are currently nearing their floor. The rest of the energy section will continue to rise, and likely food at home. This ain't over.

Even the 16% Trimmed Mean and the Median says it ain't over. Tomorrow's PPI might provide a hint.