It's The Economy Stupid: CPI not so much

Consumer Prices in U.S. Declined More Than Forecast in November

 

Economic Event	Period	Economic Survey	Actual Reported	Original Prior	Revised Prior
Consumer Price Index MoM	NOV	-0.2%	-0.3%	0.1%
CPI Ex Food & Energy MoM	NOV	0.2%	0.1%	0.2%
Consumer Price Index YoY	NOV	1.9%	1.8%	2.2%
CPI Ex Food & Energy YoY	NOV	2.0%	1.9%	2.0%
Consumer Price Index NSA	NOV	230.341	230.221	231.317
CPI Core Index SA	NOV		231.254	230.994

 

Right now, today, inflation is largely a non-issue.

 

The cost of living (as defined by CPI as opposed to as defined by an average human being pocket book) fell more than forecast in November as energy prices dropped, a sign U.S. inflation remains in check.

 

The 0.3 percent decrease in the consumer-price index was the first drop since May and followed a 0.1 percent gain the prior month. The median estimate of 80 economists surveyed by Bloomberg called for a 0.2 percent drop. The core index, which excludes volatile food and energy costs, climbed less than projected.

 

Bloomberg survey estimates for the consumer-price index ranged from a drop of 0.3 percent to an increase of 0.1 percent.

 

In the 12 months ended in November, consumer prices rose 1.8 percent, today’s report showed.   The core CPI reading increased 0.1 percent last month following a 0.2 percent gain in October. For the past 12 months, core prices were up 1.9 percent, compared with a 2 percent advance for the year through October. The core measure was restrained by a 0.1 percent gain in medical care, that reflected a record drop in drug costs. In addition, clothing and used-car prices fell.  Falling energy costs, including cheaper gasoline, are keeping inflation in check. Energy costs decreased 4.1 percent in November, the biggest drop since May. Gasoline plunged 7.4 percent, the largest decrease since December 2008.

 

 

John Broussard

Assistant State Treasurer

Chief Investment Officer

State of Louisiana

Department of the Treasury