Friday, March 16, 2012

It's The Economy Stupid: CPI

The cost of living, as measured by the Consumer Price Index, or CPI, rose by the most in 10 months, due to the jump in the cost of gasoline, which has not spread to other goods and services so far.

 

Economic Event

Period

Economic Survey

Actual Reported

Original Prior

Revised Prior

Consumer Price Index MoM

FEB

0.4%

0.4%

0.2%

 

CPI Ex Food & Energy MoM

FEB

0.2%

0.1%

0.2%

 

Consumer Price Index YoY

FEB

2.9%

2.9%

2.9%

 

CPI Ex Food & Energy YoY

FEB

2.2%

2.2%

2.3%

 

Consumer Price Index NSA

FEB

227.95

227.663

226.665

 

CPI Core Index

FEB

-

227.907

227.684

 

 

The consumer-price index climbed 0.4 percent, matching the median forecast of economists surveyed by Bloomberg News, after increasing 0.2 percent the prior month. The so-called core measure, which excludes more volatile food and energy costs, climbed 0.1 percent, less than projected.

 

The biggest jump in gasoline in more than a year accounted for about 80 percent of the increase in prices last month, leaving households with less money to spend on other goods and

services.

 

Okay, try not to laugh at this part - Federal Reserve policy makers say the advance in fuel costs will be temporary, and most see little risk inflation will

flare out of control as unemployment exceeds 8 percent.

 

Consumer prices increased 2.9 percent in the 12 months ended in February, the same as in January.

 

Today’s report showed energy costs increased 3.2 percent from a month earlier. Gasoline jumped 6 percent, the most since

December 2010.

 

Today’s report showed food costs were little changed, the least since July 2010. The increase in the core measure reflected higher prices for new cars and hotel stays. Clothing costs dropped by the most since July 2006, and used-cars were also cheaper last month.

 

Paychecks are failing to keep up with even limited inflation, another Labor Department report today showed. Hourly earnings adjusted for prices dropped 0.3% in February, and were

down 1.1 percent over the past 12 months, today’s report showed.

 

The CPI is the broadest of the three monthly price measures from the Labor Department because it includes goods and services. About 60 percent of the CPI covers prices consumers

pay for services ranging from medical visits to airline fares and movie tickets.

 

 

John Broussard

Assistant State Treasurer

Chief Investment Officer

State of Louisiana

Department of the Treasury

Ph:  225-342-0013

Fx:  225-342-9721

Email:  jbroussard@treasusry.state.la.us

 

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